NovartisIn the biotech version of what goes around, comes around, Novartis AG will market Vanda Pharmaceuticals’ schizophrenia drug in the United States and Canada, which would net royalty revenue for South San Francisco’s Titan Pharmaceuticals Inc.

Titan, which had licensed iloperidone from Hoechst in early 1997, later that year licensed the drug to Swiss drug giant Novartis. But after the drug ran into trouble in Phase III, Vanda took it on in 2004.

Now Rockville, Md.-based Vanda , which in May won FDA approval of iloperidone, will receive a $200 million upfront payment from Novartis for development and commercialization rights. It also could get development and commercial milestone payments totaling up to $65 million.

Novartis will take on development of a long-acting injectable formulation of iloperidone, which carries the brand name Fanapt.

Titan will receive royalties on global net sales of iloperidone equal to 8 percent on annual net sales up to $200 million. That rate would increase to 10 percent on annual sales above $200 million.

Titan shares closed up 30 cents on Tuesday, to $1.79. The stock had closed as low as 5 cents per share on May 6.