UCB Inks Buyback-Option Deal With Wilex For Oncology Lineup
This article was originally published in The Pink Sheet Daily
Executive Summary
Sharing costs and risk could help ease UCB’s recent woes with Cimzia, Neupro.
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UCB's buyback option-based oncology deal with Wilex, disclosed Jan. 9, takes research costs for two small molecules and three antibodies off the books until decision time, and will cost UCB just euro 10 million (US$13.46 million) and another euro 10 million when the first program reaches Phase I trials. Olaf G. Wilhelm, chairman of Munich, Germany-based Wilex's board, predicted during a conference call related to the deal that the first program would reach Phase I in the next 12 months, but he declined to give much detail, putting off further word until the firm gives financial guidance Feb. 19. "We will disclose the milestones as we achieve them," he said. Under the terms, UCB, of Brussels, Belgium, has granted the rights to the five preclinical oncology programs to a new legal entity wholly owned by UCB and funded with the euro 10 million. Wilex, in turn, will acquire the entity in a process that involves issuing about 1.8 million new shares. As a result of the deal, UCB will own 13 percent of Wilex. UCB can buy back the programs after first clinical feasibility studies finish, and take over development and commercialization, in which case Wilex would get milestone payments and royalties. If UCB opts not to re-purchase, Wilex keeps rights and pays milestones plus royalties to UCB. The shrewd risk-and-cost-sharing arrangement helps UCB in handling its delay with the rheumatoid arthritis drug Cimzia , stalled earlier this month by a complete response letter from FDA, which wants updated safety data for the tumor necrosis factor inhibitor (1 (Also see "Cimzia Rheumatoid Arthritis Approval Held Up By Safety Request" - Pink Sheet, 5 Jan, 2009.)). First cleared by FDA in April 2008 for Crohn's disease, Cimzia (certolizumab pegol) ran into efficacy concerns before that approval. The Wilex/UCB deal echoes previous deals such as Lilly's R&D-based agreements with Indian firms, and the TK year pact between Genentech and Xoma for Xolair . As part of that deal, Genentech had Xoma develop the asthma drug Xolair (omalizumab) under a buyback option, which Genentech exercised. Last month, UCB also ran into some difficulty with the rotigotine transdermal system Neupro , which FDA smacked with a complete response letter (2 (Also see "UCB’s Neupro Manufacturing Problems Hold Up Approval For Advanced Parkinson’s Disease" - Pink Sheet, 19 Dec, 2008.)). UCB wants to expand the use of the nonergolinic dopamine agonist Neupro, already cleared for early stage idiopathic Parkinson's disease, to advanced Parkinson's and moderate to severe primary restless legs syndrome. In April, Neupro was recalled after rotigotine crystals formed in some of the skin patches. Wilex's pipeline includes drugs and diagnostic tests. Rencarex (WX-G250), an antibody that binds to an MN-antigen expressed on tumor cells, is undergoing Phase III trials in renal cancer. Redectane , for the pre-surgical diagnosis of clear cell renal cancer, also is in Phase III registration trials. At the Phase II stage for pancreatic and breast cancers is Mesupron , an oral second generation serine protease inhibitor targeting the urokinase plasminogen activator system. - Randall Osborne ([email protected]) |