Israel-based Teva will be responsible for all US commercial and clinical activities for Adasuve and has gained rights to conduct additional clinical trials for potential new indications in neurological disorders.
Alexza will be responsible for manufacturing and supplying Adasuve to Teva for commercial sales and clinical trials.
"Approximately four to five million patients with bipolar I disorder or schizophrenia in the US experience and seek treatment for agitation episodes," said Larry Downey, Teva president for North America specialty medicines.
"This agreement reflects our business development strategy to pursue opportunities in our core therapeutic areas."
Under the terms of agreement, Alexza will receive an upfront cash payment of $40 million and is eligible to receive up to $195 million in additional milestone payments, based upon successful completion of the Adasuve post-approval studies in the United States and achieving sales targets.
In addition, Teva will make royalty payments based on commercial sales of Adasuve. Teva also will make available up to $25 million to Alexza via a five-year convertible note and agreement to lend, which Alexza may access to support its Adasuve activities.
Adasuve was approved by the US Food and Drug Administration in December 2012.