Wednesday, December 22, 2010

And the 2010 Alliance DOTY Nominees Are ...

OK, IN VIVO blog readers, it's time to have your say. We've supplied the nominations but YOU will decide the winners. Once again we've created a special page so you can vote on all three categories in one place. Remember you much click on the "VOTE" button in each individual category--Alliance, M&A, and Exit/Financing--to record your choices.


Below, in no particular order, are the nominees for IVB's 2010 Alliance Deal of the Year!

ABBOTT/REATA: Abbott Labs agreed to pay $450 million up-front for non-US, non-Asia rights to the Reata's bardoxolone for chronic kidney disease. In connection with the Abbott transaction Reata has doled out some of that record-breaking upfront to investors who've poured $178 million into the company since its formation in 2002. Just based on the sheer size of the deal's upfront payment, Abbott/Reata deserve a Deal of the Year nod. But there's more about the tie-up that piques our interest. Not least, Abbott has proven itself to be an adventurous biopharma dealmaker and could well reach the podium in more than one category this year. Moreover at a time when industry seems to be scrambling for quality assets and belt-tightening at every opportunity, it's exciting to be reminded that there are drug candidates out there that generate significant interest because of their potential to change the course of disease and define new treatment paradigms. Read our full nomination post here.

CELGENE/AGIOS: In exchange for $130 million in upfront cash and equity investment, Agios, one of the leaders in a happening scientific space called cancer metabolism, gives Celgene an exclusive option to develop any drugs resulting from its research platform at the end of Phase I. Celgene can extend the exclusivity period – if Agios agrees – but it will have to provide additional funding for the privilege. On each program Celgene licenses, Agios could receive up to $120 million in milestones, as well as royalties on sales. It's the latest on big-bro-little-bro dealmaking; note that Agios remains the one running the discovery and early translational work until an option is exercised--and the biotech has a say if Celgene wants to delay bringing a program in house. Read our full nomination post here.

PFIZER/BIOCON: The terms are pretty plain vanilla - Pfizer pays $200M upfront to Indian biotech Biocon and an additional $150M in development and regulatory milestones, plus payments tied to commercialization. In exchange, it gets rights to sell Biocon's portfolio of biosimilar insulins throughout most of the world. While the structure of Pfizer/Biocon is quite traditional, the concept is anything but. Indeed, the union of these two companies is, in fact, blatantly ambitious and could have far reaching implications. It demostrates a new way of doing business for pharma, touching on an battery of industry hot topics: biosimilars, pricing flexibility, diversification and emerging markets. Read our full nomination post here.

GSK/AMICUS: Faced with slack pipelines and increasing payor demands, big pharma CEOs spouted the words "niche" and "orphan" more often then "primary care" and "blockbuster" this year (though they have been biting their tongues behind the scenes or crossing their fingers behind their back). Nonetheless, GSK has gone beyond talk with action on the deal-making front, even creating a business unit exclusively devoted to rare diseases back in February. GSK's alliance with Amicus, announced in October, is the big pharma's fifth in the rare disease space in just over 12 months, and it also involves the latest-stage candidate of the bunch. Under the deal, GSK gains worldwide rights to the Phase III Fabry disease treatment Amigal (migalastat HCI), a potential first oral treatment for the genetic disease. Read our full nomination post here.

PFIZER/UCSF: Pfizer's five-year, $85 million commitment to fund academic research at UCSF is the company's latest and largest push into the so-called Valley of Death that lies between the university laboratory and the commercial sector. Like other Big Pharmas, Pfizer has inked deals with universities before, and even established a presence on UCSF's campus when it launched its Biotherapeutics & Bioinnovation Center in 2008. Still, the new UCSF deal is a more expensive, closer-knit arrangement. For Pfizer, the agreement offers access to research at the point of creation, joint ownership of drug candidates (thought to be split 50-50 with UCSF), and options to develop compounds internally after Phase I trials are completed. The university will receive royalties or other payments as the drugs march bravely toward commercialization, while also receiving a view into Pfizer's library of antibodies, reagents and other compounds. Read our full nomination post here.

BIOGEN/KNOPP: It's not necessarily how much, but what Knopp will do with, the money. Biogen Idec paid $80 million upfront -- $20 million as a fee and $60 million in equity -- for worldwide rights to KNS-760704 (dexpramipexole), which had hit its primary endpoint in a Phase II trial for ALS. Dexpramiprexole came with orphan designation in both the US and Europe, and fast track FDA status. Milestones to Knopp could add up to $265 million more, as well as tiered, double-digit royalties on worldwide sales. $80 million was more than Knopp needed for its ongoing operations, so it planned to return extra cash to investors -- a mix of low-profile institutional investors, angels and foundations. But it was no exit or share buyback, according to Knopp. Instead the investors who got the distribution kept all their equity: in essence, a one-off dividend. Read our full nomination post here.

No comments: