GlaxoSmithKline has entered into a pact potentially worth over $700 million with privately-owned Danish firm Santaris Pharma to develop antivirals using the latter’s RNA-interference technology.

Under the terms of the agreement, Santaris will grant GSK options to drug candidates developed in up to four different viral disease programmes and will be responsible for taking these RNA antagonist compounds through to completion of Phase IIa proof-of-concept trials. The UK-based drugs giant gets an exclusive option to license each compound for further development and also gets access to SPC3649, Santaris’ preclinical LNA-antimiR against micro RNA-122, which is being developed as a potential therapy for hepatitis C infection.

Cashwish, GSK is only making a $3 million upfront fee for the first antiviral programme and an equity investment of $5 million. If any drugs from that programme reach the market, Santaris could receive up to $140 million and similar payments will apply to the other three programmes. In addition, if GSK exercises its options on SPC3649, that would net the Danish company a further upfront payment of $5 million and other milestones of up to $122 million if the drug obtains regulatory approvals in Europe and the USA. Santaris will also receive high single-to- double-digit royalties on sales of alliance products.

Henrik Orum, chief scientific officer of Santaris, which has also just raised $30 million in a venture financing round, said his firm is confident “that the high potency and exquisite precision” of RNA targeting achievable through its ‘locked nucleic acid’ technology “has the potential to achieve clinical breakthroughs in viral infections”. He added that “I can think of no stronger partner…in infectious disease research than GSK”.

Meantime, GSK announced that it has completed its $1.65 billion acquisition of Reliant Pharmaceuticals after a quicker-than- expected antitrust review ended in the USA. The deal gives the firm access to the heart disease drug Lovaza (omega-3-acid ethyl esters).