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Sydney based () has closed an agreement with one of the world's 20 leading pharmaceutical companies Boehringer Ingelheim for it to acquire ’ phase 1 anti‐inflammatory drug candidate.
In a landmark deal that recognises ' global drug discovery strengths Boehringer Ingelheim will pay €27.5 million or $39 million upfront to the company but could potentially be worth up to $A750 million in tiered and milestone payments.
Boehringer Ingelheim GmbH was founded in 1885 by Albert Boehringer in Ingelheim am Rhein Germany.
In March 2015 signed an option and asset purchase agreement with Boehringer Ingelheim for the Semicarbazide‐Sensitive Amine Oxidase/Vascular Adhesion Protein‐1 (SSAO/VAP‐1) Inhibitor PXS4728A.
Boehringer’s primary interest in PXS4728A is directed at the liver related disease Non‐Alcoholic Steatohepatitis (NASH).
NASH is the progressive form of non‐alcoholic fatty liver disease (NAFLD) which is the most common and nasty liver disorder in Western industrialized nations.
NASH is regarded as a major cause of cirrhosis of the liver and is an area of high unmet clinical need.
Payments to from Boehringer Ingelheim
- Upfront payment of €27.5 million
- Up to a total of €55 million in development milestone payments tied to the commencement of phase 2 and 3 clinical trials
- Up to a total of €140 million in regulatory milestone payments upon filing of applications for marketing approval and receipt of regulatory and pricing approvals for a PXS4728A program in major markets
- Additional milestone payments similar in total to those set forth above upon achievement of the same development and regulatory milestone events by a PXS4728A program
- Earn‐out payments on annual net sales of PXS4728A program products at tiered percentages starting in the high single digits
- Commercialisation milestone payments upon achievement of specified levels of annual net sales of PXS4728A program products
In all this is a scintillating deal struck by with a "big pharma" and demonstrates at the current market valuation minus cash of $23 million at March quarter 2015 end the stock is significantly under-valued.
The company recorded positive cash flow for the March quarter of $3.2 million.
The mannitol products has developed for cystic fibrosis (Bronchitol) and asthma (Aridol) have significant upside potential and show how deep the drug discovery pipeline is for .
The agreement with Chiesi provides with an opportunity to access the large U.S. CF market through Chiesi’s specialist commercial infrastructure.
The Phase 3 clinical trial being conducted to gain approval for Bronchitol to treat cystic fibrosis in the United States (funded by Chiesi) continues to recruit with enrolment expected to complete by the end of the calendar year.
There are significant price catalysts still ahead for .
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