Cambridge Antibody Technology and AstraZeneca Announce Major Strategic Alliance to Discover and Develop Human Antibody Therapeutics in Inflammatory Disorders
Monday November 22, 2:01 am ET
AstraZeneca to Take 19.9% Equity Stake in Cambridge Antibody Technology
CAMBRIDGE, England, Nov. 22 /PRNewswire-FirstCall/ -- Cambridge Antibody Technology (LSE: CAT - News; Nasdaq: CATG - News) and AstraZeneca (LSE: AZN, Nasdaq: AZN) announced today a major strategic alliance for the joint discovery and development of human monoclonal antibody therapeutics, principally in the field of inflammatory disorders, including respiratory diseases. The innovative partnership structure of the alliance reflects each company's leading position in its respective field and the growing importance of antibodies as therapeutics. The alliance will be co-funded and co-managed by the partners.
The principal terms of the collaboration agreement between the two parties are summarised below:
* The alliance will include a five-year discovery initiation phase
during which the partners will jointly initiate a minimum of 25
discovery programmes. The committed joint research investment will be
a minimum of $175m during this phase which the parties will fund
50:50. CAT will contribute the greater part of the resource in this
discovery phase and expects to commit between 100 and 150 scientists
per year to the programme at its peak, most if not all of which will
come from existing resources. The principal focus of the discovery
programmes will be in inflammatory disorders, however the research may
extend to other therapeutic areas.
* Following the completion of the discovery phase, the parties may each
elect to continue funding programmes into development. If both parties
so elect, the programme will be jointly funded until Clinical Proof of
Concept (end of Phase IIb trials), unless either party opts-out
earlier. In addition, CAT has the option to continue to fund jointly
the development of one in every five products that reach Clinical
Proof of Concept up to product launch.
* CAT's financial participation reflects its level of investment in the
programme. If CAT opts-out after the discovery phase it receives
milestones and royalties. If it opts-out at Clinical Proof of Concept
it receives milestones and royalties at a higher level. For those
programmes which it funds to product launch it receives higher
royalties, sales milestones and an option to co-promote these products
in the US. If AstraZeneca opts-out of programmes it receives
milestones and royalties.
* AstraZeneca will receive the rights to opt-in to, and develop jointly,
CAT discovery programmes existing at the commencement of this alliance
and also certain future discovery programmes that CAT may
independently initiate. CAT has rights to co-promote in the US
products resulting from these programmes.
* CAT will be principally responsible for antibody discovery,
manufacturing process development and the supply of material for
exploratory clinical trials. AstraZeneca will be principally
responsible for translational biology, clinical development
programmes, regulatory filings and commercialisation. Joint teams
will be established to oversee the full discovery and development
process.
* CAT anticipates that its investment in the alliance will be the
principal focus of its research investment during the next five years.
* Under a separate Subscription Agreement, AstraZeneca will subscribe in
cash for 10,217,983 CAT shares at a price of #7.34 per share for a
total investment of #75 million. Based on CAT shares in issue as at 21
November 2004, this represents a 19.9% interest in the enlarged issued
share capital of CAT. The price represents a 27.3% premium to CAT's
average closing share price for the last five business days. The
subscription agreement between AstraZeneca and CAT contains certain
restrictions on AstraZeneca's ability to increase its stake or to sell
shares.
* The subscription by AstraZeneca requires the disapplication by CAT
shareholders of statutory pre-emption rights. A circular convening an
Extraordinary General Meeting for this purpose is being posted to CAT
shareholders shortly. The alliance is conditional on the completion
of the Subscription Agreement.
Peter Chambre, Chief Executive Officer of CAT, commented, "This innovative alliance with a world leader in the field of inflammatory diseases represents a major strategic move by both companies. Not only will it enable CAT to deploy its full range of capabilities and expertise in the early stages of product development, but it will also allow us to enhance our capabilities in the later stages and, for the first time, potentially participate in product commercialisation. Most significantly, CAT will share directly in the successes of products which result from the collaboration and it is therefore an important and exciting opportunity for us to make a significant advance in our transition to a product-based biopharmaceutical company. The creation of this alliance with AstraZeneca is a tribute to their vision in seeing the opportunity for a new model of collaboration between a major pharmaceutical company and a leading biotechnology company."
Sir Tom McKillop, Chief Executive Officer of AstraZeneca, said, "I see this alliance with Cambridge Antibody Technology as a major component of AstraZeneca's strategy to develop new therapeutics for inflammatory and respiratory diseases. Both partners are combining their expertise and making a significant commitment of resources to the alliance."
Dr John Patterson, Executive Vice President Product Strategy & Licensing at AstraZeneca also commented, "We are delighted to be joining other shareholders in this innovative biopharmaceutical company and are underpinning the closeness of the alliance and strategic importance to both parties by making a significant equity investment in Cambridge Antibody Technology". .. |
