Avigen sells technology for $12M
Wednesday December 21, 1:06 pm ET
Avigen Inc. said Wednesday that it has sold gene therapy assets to Genzyme Corp. for $12 million in cash plus potential future payments.
The assets include all of Alameda-based Avigen's (NASDAQ: AVGN - News) non-pain related AAV assets, including rights to the company's Parkinson's disease clinical trial program.
In a statement, Avigen's President and CEO Kenneth Chahine said, "This agreement marks a significant milestone in Avigen's strategic move from a gene therapy company to a pharmaceutical company focused on small molecule therapeutics to treat neurological disorders."
For Massachusetts-based Genzyme (NASDAQ: GENZ - News), the acquisition will diversify its research involvement.
Published December 21, 2005 by the East Bay Business Times
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Genzyme's Gene Therapy Grows
By Althea Chang
TheStreet.com Staff Reporter
12/21/2005 1:13 PM EST
Genzyme (GENZ:NYSE - commentary - research - Cramer's Take) has expanded its gene-therapy technologies by acquiring a group of assets from biotech outfit Avigen (AVGN:NYSE - commentary - research - Cramer's Take).
Genzyme paid Avigen $12 million and will make milestone and royalty payments based on product developments, approvals and sales. The purchase includes patent rights on Avigen's virus technology and an early-phase Parkinson's disease clinical trial program, as well a s acollaboration on a treatment for hemophilia, a bleeding disorder.
Shares of Avigen initially shot up 5% when the market opened Wednesday, but were recently trading down 1 cent at $2.94. Genzyme shares were up $1.72, or 2.4%, to $72.44.
The move is Genzyme's latest bid to bolster its gene technology. Last month it acquired Cell Genesys' (CEGE:NYSE - commentary - research - Cramer's Take) viral manufacturing facilities.
"We look forward to advancing Avigen's ongoing work in Parkinson's disease and hemophilia, areas where we believe gene therapy could play a meaningful role in treatment," said Rich Gregory, Genzyme's head of research.
Avigen is shifting its focus to neurological disorders, according to its president and CEO, Kenneth Chahine. The deal, he says "makes sense at multiple strategic and financial levels."
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