A new partnership to develop IRAK-4 inhibitors

|By:, SA News Editor

Ligand Pharmaceuticals (LGND) and TG Therapeutics (TGTX) team up to develop and commercialize Ligand's Interleukin-1 Receptor Associated Kinase-4 (IRAK-4) inhibitors. The program is currently in the preclinical stage for certain cancers and autoimmune diseases.

Under the terms of the agreement, Ligand will receive 125,000 shares of TGTX common stock (value ~$1M) and is eligible to receive $207M in potential milestone payments. Upon regulatory clearance, it will earn tiered royalties of 6 - 9.5% on net sales of licensed products containing patented IRAK-4 inhibitors. The specific royalty scheme is: 6% of annual sales up to $1B and 9.5% of sales above $1B. The royalty rate for licensed products not covered by LGND's issued patents will be 4.5%.

IRAK-4 is a serine/threonine protein kinase that is an important downstream signaling component of the IL-1 receptor and multiple toll-like receptors. It has a key role in innate immunity and inflammation.

Ligand acquired the rights to the technology via its acquisition of Pharmacopeia in 2008.