Teva invests more in diabetes treatment co

Andromedia Biotech is continuing a Phase III trial of its leading product.

Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) has exercised its option to invest an additional $11.9 million in diabetes drug developer Andromeda Biotech Ltd. at a company value of $170 million, before money.

As part of the exercise of the option, Andromeda's parent company, Clal Biotechnology Industries Ltd. (TASE: CBI) will also invest $5.6 million, bringing the total investment in the company to $17.5 million.

The investment will reduce Clal Biotech's stake in Andromeda from 89% to 84% (77% on a fully diluted basis.

Andromeda will use the proceeds to finance the continuation of the Phase III clinical trial of its leading drug candidate, DiaPep277, for the treatment of type 1 diabetes. The trial includes 450 recently diagnosed patients aged 20-45 at 100 medical centers worldwide.

The drug modulates the immune system to prevent the destruction of pancreatic cells that secrete insulin and thus preserve their natural function. There is no current therapy that can prevent the destruction of insulin secreting beta cells.

Andromeda CEO Dr. Shlomo Dagan said, "Andromeda has become one the few companies that has almost completed the development of its drug. Success in the trial will allow the company to apply for marketing certification for this incurable disease."

Clal Biotech's share price rose 3.3% % in early trading on the TASE today to NIS 19.72, giving a market cap of NIS 1.84 billion.

Published by Globes [online], Israel business news - - on June 14, 2010

© Copyright of Globes Publisher Itonut (1983) Ltd. 2010

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