FDA approval of Pfizer nasal spray migraine drug Zavzpret last week means a $475 million payday for Royalty Pharma. The payment stems from a financing deal Pfizer inherited when it acquired rights to the drug last year.

Zavzpret, which was known in development as zavegepant, was initially developed by Biohaven Pharmaceuticals. Under a 2018 deal, Royalty Pharma paid Biohaven $100 million up front in exchange for the right to receive payments tied to revenue from sales of two migraine drugs, one intranasal and the other one an oral drug.

The oral drug, Nurtec ODT, was approved in 2020. Later that year, Biohaven and Royalty Pharma expanded their agreement to add success-based milestone payments, the first of which is a payment upon the FDA approval of the intranasal drug now known as Zavzpret. That’s the $475 million payment that Royalty Pharma announced on Thursday.

Both Nurtec and Zavzpret are part of a new class of migraine drugs that block calcitonin gene-related peptide, a protein associated with the onset of migraine pain. The first CGRP inhibitors were large molecule drugs administered as infusions or injections. Nurtec, a small molecule, is dosed as a quick-dissolving tablet placed under the tongue. The drug’s initial approval was for the treatment of acute migraine pain. In 2021, the Nurtec won an additional FDA approval for migraine prevention.

Nurtec provides migraine pain relief within an hour. Intranasal Zavzpret is designed to work even more quickly, taking effect as soon as 15 minutes. The drug’s approval last Friday makes it the only approved intranasal CGRP inhibitor. Pfizer said it expects to the product will be available in pharmacies in July.

Clinicians say intranasal dosing gives migraine patients more options in selecting the most appropriate treatment. Shae Datta, a neurologist and migraine expert from NYU Langone Health, said in an emailed statement that patients with difficult-to-treat migraines often have nausea and vomiting, so a drug delivery system that brings the medicine closer to the brain has advantages.

“We always want to have more options other than oral because intranasal formulations avoid the liver and anyone with liver issues can use this drug more safely in treating migraines,” she said.

Pfizer signed on as a commercialization partner to Biohaven in 2021, paying $500 million up front. Biohaven retained U.S. rights while Pfizer gained the right to commercialize Nurtec and Biohaven’s other migraine compounds everywhere else. Nearly a year ago, Nurtec won approvals in Europe for both acute migraine and migraine prevention. Soon after, Pfizer decided to capture all of the benefits of the Biohaven migraine portfolio. Last May, the pharmaceutical giant agreed to pay $11.6 billion to acquire Biohaven.

According to Royalty Pharma’s 2022 annual report, the company is entitled to a 2.1% royalty on the annual combined global sales of Nurtec and Zavzpret up to $1.5 billion, and a 1.5% royalty on annual combined global sales above $1.5 billion. The deal also pays a 3.0% incremental royalty on net worldwide Zavzpret sales up to $1.5 billion and an up to 2.0% incremental royalty on global sales above $1.5 billion. Royalty Pharma estimates its royalties for the migraine drugs will end between 2034 and 2036.

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