The companies were co-developing bremelanotide, a drug to activate melanocortin hormones in the pituitary gland for the treatment of male erectile dysfunction (ED) and female sexual dysfunction (FSD).
Less than two weeks ago, the US Food and Drug Administration (FDA) questioned the overall efficacy results and the clinical benefit of bremelanotide, following an analysis of both Phase I and Phase II data in both the general and diabetic ED populations.
Citing blood pressure increases as its greatest safety concern, the FDA said it did not support beginning Phase III studies for ED.
However, the regulators did say that they were amenable to proposals for a different drug development pathway, such as for a second-line therapy in non-responders to currently approved PDE-5 inhibitors, such as Pfizer's Viagra (Sildenafil).
Following that disappointment, King Pharmaceuticals has now decided not to continue developing the drug, although the decision will not take affect until December.
The company has no financial obligation for future payments to Palatin, other than for previously incurred costs not yet reimbursed and approved expense reimbursements related to the wind-down of the collaboration.
King is also left with the previously issued Palatin unregistered common stock and warrants.
Meanwhile, Palatin stated that it is in the process of reviewing the responses and comments made by the FDA and plans to engage the FDA in further discussions in order to determine next steps related to the further development of bremelanotide for the treatment of ED.
"Regarding the FSD program with bremelanotide, we have completed an exploratory at-home Phase II clinical trial in pre- and postmenopausal women and are in the final stages of compiling the data.
We anticipate releasing the results later this month," stated Dr Carl Spana, CEO of Palatin.
Palatin will be hoping for more luck with its other melanocortin agonists, including preclinical anti-obesity drug candidates that were the subject of a $300m deal with AstraZeneca earlier in the year.
The company also has a lead clinical candidate for the treatment of congestive heart failure.