AKA - Great timing on ZGEN "trainwreck":
Bristol-Myers, ZymoGenetics in $1B hepatitis deal
Monday January 12, 4:03 pm ET
By Linda A. Johnson, AP Business Writer
Bristol-Myers, ZymoGenetics sign hepatitis C drug development deal worth up to $1.1B for Zymo
TRENTON, N.J. (AP) -- Drugmaker Bristol-Myers Squibb Co. and biotech company ZymoGenetics Inc. have signed a deal worth up to $1.12 billion to develop a hepatitis C drug based on a new type of the immune-system stimulant interferon.
New York-based Bristol-Myers will pay ZymoGenetics, of Seattle, Wash., $85 million in cash up front for the rights to develop its PEG-Interferon lambda, which already is in early testing in people. Bristol-Myers also will pay its new partner a license fee of $20 million this year, followed by additional payments that could total just over $1 billion if a series of milestones are reached.
The two companies will test the drug jointly in the United States and Europe and share those costs. The companies said they expect ZymoGenetics will conduct much of the ongoing early human studies, plus some of the midstage testing in people. ZymoGenetics will have an option to jointly sell and share in product profits from U.S. sales, and will receive roylaties from Bristol-Myers on foreign sales.
Interferon is a substance that stimulates the immune system to fight invaders. It has been used to treat hepatitis C, a viral infection of the liver, as well as some forms of cancer.
The two partners will do research on a new, type-3 interferon with a technology, called pegylation, designed to keep the drug active in the body as long as possible, something now standard for advanced hepatitis C treatments. The companies said their compound affects a different cell receptor then existing interferon treatments, and that that could result in more targeted therapy and more effectiveness.
Bristol-Myers Squibb, the world's No. 14 drugmaker by revenue, currently has no hepatitis C drugs on the market. However, it has three other compounds in development, according to a company spokeswoman. Bristol-Myers co-markets blood thinner Plavix, the world's second-best-selling drug.
About 170 million people worldwide are infected with hepatitis C, a virus transmitted by blood that damages the liver and is difficult to treat. Among people with chronic hepatitis C infection, 1 percent to 5 percent develop liver cancer, and others may need a liver transplant.
ZymoGenetics would get up to $430 million if it reaches set milestones for development and approval of PEG-Interferon lambda for treating hepatitis C, up to $287 million for development and regulatory approvals of drugs to treat other conditions, and up to $285 million for meeting certain sales goals.
ZymoGenetics develops drugs based on proteins and currently sells Recothrom, a genetically engineered treatment to stop bleeding.
