>>SOUTH SAN FRANCISCO, Calif., July 23 /PRNewswire-FirstCall/ -- Cell Genesys, Inc. (Nasdaq: CEGE - News) today announced a global alliance between Cell Genesys and Novartis AG (NYSE: NVS - News) for the development and commercialization of oncolytic virus therapies. Under the agreement, Cell Genesys has acquired exclusive worldwide rights to the oncolytic virus therapy products and related intellectual property of Genetic Therapy, Inc. (GTI), an affiliate of Novartis, and will receive a signature payment of $28.5 million from Novartis to be dedicated to the further development of several oncolytic virus therapy products from both Cell Genesys and GTI for which Novartis has certain options. In exchange, Cell Genesys will issue to Novartis 1,999,840 shares of Cell Genesys common stock, with the result that Novartis will become the holder of approximately five percent of Cell Genesys' currently outstanding common stock. In addition, the agreement provides the basis for the sharing of future additional development costs and potential profits for the products on a worldwide basis. Other financial terms have not been disclosed.
"Cell Genesys is very pleased to enter into this strategic alliance with Novartis AG, one of the world's leading oncology companies," stated Stephen A. Sherwin, M.D., chairman and chief executive officer of Cell Genesys. "We are excited about the potential for oncolytic virus therapies to benefit patients with cancer and believe that these products are an important complement to our more advanced clinical programs for GVAX® cancer vaccines."
"We are excited about the opportunity to further research in the field of oncolytic virus therapy, and we want to help establish Cell Genesys as the leading company in the field," said Kathleen E. Walsh, chief operating officer of Novartis Institutes for BioMedical Research. "Cell Genesys has a strong presence and manufacturing capabilities in the field of oncolytic virus therapy. We believe this strategic collaboration is the natural progression for our oncolytic virus therapy programs, as Cell Genesys has the ability to develop these novel therapeutics for the benefit of cancer patients."
Cell Genesys' oncolytic (cancer cell killing) virus therapies represent a potential new approach in the treatment of patients with cancer. These novel therapies are comprised of adenoviruses that are engineered to preferentially replicate in and destroy cancer cells and may be several thousand times more specific for killing cancer cells than standard chemotherapeutic drugs. Once the therapy is delivered to the cancer cells, the virus is believed to replicate within the cancer cell until it bursts, destroying the cell through the natural properties of the virus and spreading the newly created viruses throughout the tumor, repeating the cycle in the neighboring cancer cells. The virus can be cleared by the body's immune system after destroying the cancer cells.<<
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