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GSK and Santaris sign GBP 700m RNA drug discovery deal

GlaxoSmithKline and Santaris Pharma enter into a worldwide strategic alliance for the discovery, development and commercialisation of novel medicines against viral diseases

UK-based GlaxoSmithKline (GSK) and Danish biotech Santaris Pharma have entered into a worldwide strategic alliance for the discovery, development and commercialisation of novel medicines against viral diseases.

Per the agreement, Santaris will grant GSK options to drug candidates discovered and developed under the collaboration in up to four different viral disease programmes.

In each R&D programme, Santaris will be responsible for the discovery and development of RNA antagonist drug candidates through to phase IIa trials.

GSK has an exclusive option to license each compound for further development and commercialisation on a global basis. The company also has an option to include Santaris' preclinical LNA-antimiR against micro RNA-122, SPC3649, as an additional programme in the collaboration. The compound is being developed by Santaris as a potential new therapy against hepatitis C.

Santaris will receive an upfront fee for the first antiviral programme of USD 3m, while GSK will make an equity investment of USD 5m in Santaris.

If candidate drugs from the first viral target programme are successful and reach the market, GSK could make additional milestone payments to Santaris Pharma of up to USD 140m for the first programme. Similar upfront payments and milestones are payable by GSK to Santaris in respect of each of the further three antiviral programmes if GSK elects to initiate these additional programmes in the collaboration.

Should GSK exercises its option to further develop and commercialise SPC3649, it will make a further up front payment of USD 5m and additional milestones of up to USD 122m, if the drug obtains regulatory approvals in the EU and the US.

Santaris could be eligible to receive in excess of USD 700m in upfront fees and development and regulatory milestones payments. If a product is successfully commercialised, Santaris will receive high single to double-digit royalties on worldwide sales of alliance products.

The collaboration provides GSK access to patented RNA antagonist compounds, based on Santaris' proprietary Locked Nucleic Acid (LNA) technology, for development as potential new therapies for selected viral diseases. GSK will operate in the alliance through its Infectious Diseases Centre of Excellence for Drug Discovery (ID CEDD).

Santaris' LNA technology is used in drug arrays to conduct expression profiling of a comprehensive range of microRNAs from any organism to accelerate drug discovery. LNA nucleosides contain nucleobases which appear in DNA and RNA.

Keith McCullagh, CEO and president of Santaris, signed the collaboration deal with GSK.

McCullagh used to be the CEO of British Biotech, which he founded in 1986 and was valued at almost GBP 2bn (USD 4bn) on the basis of its lead cancer drug, Marimastat. He was forced to resign from the company when a government select committee launched an inquiry and the stock exchange censured the company for misleading investors over the efficacy of the drug.

20th December 2007


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