Big Biotechs Ink Deals for Developing Small-Molecule Drugs

January 24, 2007
BioPharm International Editors

The world's two largest biotechs, Amgen (Thousand Oaks, CA, www.amgen.com) and Genentech (San Francisco, CA, www.genentech.com), have just announced deals to develop small-molecule drugs with respective partners.

The world’s two largest biotechs, Amgen (Thousand Oaks, CA, www.amgen.com) and Genentech (San Francisco, CA, www.genentech.com), have just announced deals to develop small-molecule drugs with respective partners. In recent years, industry observers have become accustomed to seeing traditional big pharma companies ink deals with emerging biotech drug companies, as a solution to both companies' problems: big pharma’s lack of pipeline and the small companies’ lack of resources to take drugs through to commercialization. Now, the scenario seems to be reversing.

Amgen and Cytokinetics (San Francisco, CA, www.cytokinetics.com) Incorporated have entered into a strategic collaboration to discover, develop, and commercialize novel small-molecule therapeutics that activate cardiac muscle contractility for potential applications in the treatment of heart failure. Genentech has teamed up with Exelixis, Inc. (San Francisco, CA, www.exelixis.com) for the worldwide codevelopment of XL518, a small-molecule inhibitor of mitogen activated protein kinase (MEK).

Under the terms of its agreement with Amgen, Cytokinetics receives a non-refundable upfront license and technology access fee of $42 million. In addition, Amgen obtains an option to participate in future development and commercialization of Cytokinetics' lead drug candidate arising from this program, CK-1827452, which recently completed two Phase 1 clinical trials. The collaboration is worldwide, excluding Japan. 

Joint research activities between Amgen and Cytokinetics will focus on identifying and characterizing activators of cardiac myosin as back-up and follow-on potential drug candidates to CK-1827452. During the initial two-year research term, in addition to performing research at its own expense under the collaboration, Cytokinetics will continue to conduct all development activities at its own expense for CK-1827452, subject to Amgen’s option and according to an agreed development plan.

Under its deal with Genentech, Exelixis will receive upfront and milestone payments totaling $40 million upon signing the agreement and with the submission of the IND for XL518 to the FDA. Exelixis is responsible for developing XL518 through the end of Phase I. Exelixis submitted an IND for XL518 to the FDA on December 20, 2006.
 
If Genentech exercises its option to further develop XL518, Exelixis will receive an additional payment and Genentech will be responsible for further development, including all development costs. Exelixis has the option to copromote in the US along with Genentech. Exelixis has a substantial share in the marketing and commercialization costs, as well as an initial equal share in profits in the US, which will decrease as sales increase. Exelixis will receive royalties on any sales of the product, which may be commercialized outside the US.

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