Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) signed another unique investment agreement today, and with it will make significant inroads with an Israeli drug developer, in return for milestone payments. Teva also acquired an option to buy the company.
Ubiquitin system drug discovery firm Proteologics Ltd., announced the licensing of three programs to Teva. Under the agreement, Proteologics will discover and conduct early development of cancer treatments, while Teva will proceed with later stages of development, manufacturing and worldwide commercialization of the products.
Teva already owns 15% of Proteologics, having invested several million dollars in the company.
Teva has previously invested in Andromeda and MediWound in similar deals.
Under the current deal, Teva will invest several million dollars for control of the company, and will fund its research into the three cancer treatments. The treatments are in very early stages of research, before the clinical trial stage.
After two years of development, Teva will be able to decide if to take ownership and carry them through the clinical trial, regulatory approval, and marketing stages.
The value of Proteologics used for the deal was not reported, but based on previous deals with firms at similar stages, it can be estimated that Teva will invest several tens of millions of dollars, and that the company value, if purchased, will be over $100 million.
Proteologics and Teva first collaborated in March 2005 developing cancer therapeutics in two discovery programs, based on the ubiquitin system components. The new deal further reinforces the collaboration by granting Teva the right to continue drug development in these two programs, in addition to a license of the new discovery program. In return, Proteologics is entitled to payments pending on the achievements of milestones, as well as royalties from sales. Proteologics retains freedom to collaborate on different programs with any other partners.
"The deal with Teva complements our corporate strategy of growth through early stage collaborations with large pharmaceutical companies. We believe that joining innovation expertise of biotech with the supporting infrastructure of Pharma at earlier stages of drug discovery creates a clear benefit for both sides. Proteologics' proven abilities in the ubiquitin drug discovery together with Teva's drug development and marketing position will maximize our efforts in the search of promising new therapeutics," said Proteologics CEO Avishai Levy.
Proteologics is a leading force in investigating the ubiquitin system for the discovery and development of novel therapeutics. Dr. Avram Hershko and Dr. Aaron Ciechanover - the 2004 Nobel Prize in chemistry laureates for the discovery of the ubiquitin system together make up the company's scientific advisory board.
Published by Globes [online], Israel business news - www.globes-online.com - on September 15, 2008
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