UK life sciences company BTG is celebrating a cash windfall following the news that the Swiss major Novartis is to acquire the USA’s Protez Pharmaceuticals in a deal worth $400 million.

BTG was a founder member of privately-held Protez, which since 2003 has been working on the discovery and development of antibiotics. Its most advanced compound, PZ-601, is an antibiotic which belongs to a class of agents known as carbapenems, and has been shown to have a broad spectrum of activity that could offer better coverage over existing injectable antibiotics, especially against multidrug-resistant bacteria including MRSA (methicillin resistant Staphylococcus aureus).

A 100-patient, Phase II study was started by Protez in May in the USA to evaluate PZ-601 in patients with complicated skin and skin structure infections including cellulites, abscesses, infected wounds and ulcers. First regulatory submissions are planned for 2012.

How much BTG gets out of the Novartis deal will be largely dependent on the progress of PZ-601. Once the transaction closes, BTG will receive approximately $5 million, being its share of the initial $100 million that the Swiss firm is stumping up. It will then get further sums of up to $15 million, that being 5% of the additional consideration of $300 million payable should PZ-601 achieve certain development and commercialisation targets.

Louise Makin, BTG’s chief executive, said the group is “delighted with the progress made by Protez and are confident that as part of Novartis "its programmes will play a major role in the field of infectious diseases”. She added that “it is also pleasing to see this investment deliver such a good return”.