Having just bought UK antibody developer Domantis, GlaxoSmithKline has
again embraced the world of biotechnology through an alliance with Epix
Pharmaceuticals that could be worth over $1 billion to the small US firm.
The companies have announced a worldwide multi-target strategic
collaboration to develop medicines targeting four G-protein coupled
receptors, including EPIX’s novel 5-HT4 partial agonist programme,
PRX-03140, which is in early-stage clinical development for the treatment
of Alzheimer’s disease.
In financial terms, Epix will get an initial payment of $35 million,
including $17.5 million in the form of the purchase of three million
shares by GSK. The deal also calls for payments of up to $1.2 billion
based on the achievement of certain milestones in the GPCR programmes and Epix will also receive tiered double-digit royalties on sales of all
An interesting clause to the deal is that if GSK exercises the option to
license the Alzheimer’s programme, Epix will retain the right to
co-promote any products that emerge from the pact in the USA.
Unsurprisingly, Epix shares soared to end the day up over 30% at $7.19.
Chief executive Michael Kauffman said that the pact “will provide us with
access to significant capital in the near and long-term” and “the
co-promotion option in this collaboration provides further opportunity for
Epix to build a salesforce in the future."
GSK stock did not shift a great deal, but the company’s moves into
biotechnology in a bid to improve its pipeline is being looked on with
approval by analysts. The fact that Epix has a potential Alzheimer’s drug
makes the alliance even more interesting.