by MARIE DAGHLIAN
The pre-Christmas buying spree extended to life sciences this year as seven pharmaceutical companies rushed to announce major acquisitions and partnership deals before the holidays. The deal of the week went to Sanofi-Aventis' (NYSE:SNY) acquisition of U.S. consumer healthcare company Chattem, famous for branded products such as Gold Bond, Icy Hot, ACT, and Unisom, for $1.9 billion, creating the world's fifth largest consumer healthcare company as measured by product revenues. The acquisition now gives Sanofi a major presence in the U.S. over-the-counter business, part of the company's overall strategy of becoming a major player in the global branded generics sector and a way to achieve sustainable growth.
Not to be outshone by its French neighbor, United Kingdom pharma powerhouse AstraZeneca (NYSE:AZN
) moved to beef up its pipeline by striking two major deals just a couple of days apart. On Monday AstraZeneca said it was buying all rights to Swedish biotech Biovitrum's (OTC:BIOVY
) leptim modulator program aimed at treating obesity for $8.5 million upfront and up to $250 million in milestone payments. Then on Wednesday, AstraZeneca signed a definitive agreement to acquire privately-held Novexel, a specialty pharmaceutical company focused on novel antibiotics designed to overcome microbial drug resistance, for a total cash consideration of up to $505 million. Novexel investors will get $350 cash upfront, up to $75 million contingent on specificed development milestones, and Novexel's cash balance at closing which is expected to be about $80 million.
This acquisition gives AstraZeneca an attractive portfolio of clinical and preclinical compounds that are designed to address infections caused by drug-resistant bacteria in the hospital, including two compounds in phase 2 development, one of which has already delivered positive phase 2 data in a trial evaluating it in the treatment of community acquired pneumonia.
Novexel was created in December 2004 as an independent spin-out of the Sanofi-Aventis anti-infectives unit and is located in Philadelphia and Paris. The company's investors are Sofinnova, Atlas Venture, Novo A/S, Abingworth, Edmond de Rothschild Investment Partners, Goldman Sachs, NeoMed and Daiwa SMBC Capital.
Switzerland's Novartis (NYSE:NVS
) is acquiring privately-held U.S. biotech Corthera for as much as $620 million in a milestone-based deal which will give the pharmaceutical company exclusive worldwide rights to relaxin, a recombinant version of a naturally occurring human peptide currently in late-stage development for the treatment of acute decompensated heart failure. Novartis will pay $120 million to Corthera's current shareholders and additional payments of up to $500 million contingent upon successful development and commercialization milestones. Novartis will assume full responsibility for the development and commercialization of relaxin, which has been granted Fast Track status by the U.S. Food and Drug Administration, with regulatory submissions in the U.S. and Europe planned for 2013. Novartis has exclusive worldwide rights for relaxin in all countries except Australia and Canada. Corthera's investors include Domain Associates, Kleiner Perkins Caufield & Byers, Caxton Advantage Life Science Fund, and Sears Capital Management.
Taking the sting out of the dissolution of its partnership with Roche's Genentech (DNA), Seattle Genetics (NASDAQ:SGEN
) has been raking in the deals in recent weeks --potentially worth over $1 billion. In November the company signed a potential $362 million deal with Agensys, an affiliate of Astellas Pharma (OTCPK:ALPMF
). Last week it signed a $402 million collaboration deal with Takeda's (OTCPK:TKPHF
) Millennium. And this week, Seattle Genetics announced an antibody-drug conjugate collaboration with GlaxoSmithKline (NYSE:GSK
), potentially worth $402 million. The deal includes an upfront payment by GSK of $12 million for rights to utilize Seattle Genetics' antibody-drug conjugate technology (ADC) with multiple antigens to be named by GSK, and up to $390 million in milestones if all the ADCs in the collaboration are commercialized as well as royalties on worldwide net sales of any resulting ADC products. Seattle Genetics now has nine ADC licensees which have generated more than $35 million for the company during 2009, according to Eric Dobmeier, Chief Business Officer of Seattle Genetics.
U.S. pharma companies have been almost as busy as their European counterparts. Eli Lilly (NYSE:LLY
) entered into an exclusive worldwide license and collaboration agreement with Incyte (NASDAQ:INCY
) for the development and commercialization of Incyte's oral JAK1/JAK2 inhibitor, INCB28050, and certain follow on compounds, for inflammatory and autoimmune diseases. The deal is worth up to $755 million for Incyte, which signed a potential $1.1 billion licensing agreement with Novartis in November for another JAK1/JAK2 inhibitor for hematology and oncology diseases.
U.S. pharmaceutical giant Pfizer (NYSE:PFE
) gained one treatment and gave up another treatment. Pfizer entered into an agreement with privately-held Cleveland biotech Athersys to develop and commercialize its MultiStem investigational stem cell therapy for the treatment of inflammatory bowel disease. Under the terms of the agreement, Athersys will receive an upfront cash payment of $6 million from Pfizer, as well as research funding and support during the initial phase of the collaboration. Athersys is also eligible to receive milestone payments of up to $105 million upon the successful achievement of certain development, regulatory and commercial milestones.
Pfizer granted the Medicines Company (NASDAQ:MDCO
) an exclusive worldwide license to ApoA-I Milano, a naturally occurring variant of a protein found in human high-density lipoprotein that has the potential to reverse atherosclerotic plaque development and reduce the risk of coronary events in patients with acute coronary syndrome. Under the terms of the agreement, Pfizer will receive an up-front payment of $10 million for ApoA-I Milano and will receive additional payments upon the achievement of certain clinical, regulatory and sales milestones up to a total of $410 million.
Generics player Teva Pharmaceuticals (NYSE:TEVA
) was also in a deal making mood. The generics powerhouse is expanding its innovation pipeline with a licensing agreement to develop and commercialize OncoGenex's (NASDAQ:OGXI
) OGX-011, late stage treatment designed to counter cancer treatment resistance and enhance the effectiveness of existing therapies by blocking clusterin survival protein found in tumor cells. The partnership, worth potentially $430 million to OncoGenex, includes a $60 million upfront payment. Teva will be responsible for all commercialization and development expenses. OncoGenex will retain an option to co-promote OGX-011 in the U.S. and Canada.
The last Christmas present goes to privately-held New Jersey biotech PTC Therapeutics, and comes from its venture investors. The company completed a $50 million financing round led by The Column Group – a new investor – and existing investor Delphi Ventures. They were joined by current investors Credit Suisse First Boston, HBM BioVentures, Novo A/S, Celgene, and other existing and new investors. PTC has gotten some good data for ataluren, which is aimed at treating genetic disorders and is currently undergoing late-stage trials for the treatment of cystic fibrosis and Duchenne muscular dystrophy. The company also entered into an exclusive CNS drug discovery collaboration and licensing agreement with Roche in September that is potentially worth as much as $1.9 billion.