No clue about the royalty--Do you think its still a partnership Henry?? 50/50? I see LGND keeps the cancer rights. Did they sell the whole leptin program? tdvino is right, the Street is probably concerned about dilution, since more stock will need to be offered. Looks like that first bottle of wine is mine, sad to say.
>>Monday October 20 7:59 AM EDT
Company Press Release
Lilly and Ligand Pharmaceuticals Enter Into a Strategic Alliance To Develop and Commercialize Proprietary Products and Technology in Diabetes and Additional Therapeutic Areas
INDIANAPOLIS--(BW HealthWire)--Oct. 20, 1997--Eli Lilly and Company (NYSE:LLY) and Ligand Pharmaceuticals Inc. (NASDAQ:LGND) announced today that they have entered into a strategic alliance for the discovery and development of products based upon Ligand's intracellular receptor technology. The collaboration will focus on products with broad applications across metabolic diseases, including diabetes, obesity, dislipidemia, insulin resistance and cardiovascular diseases associated with insulin resistance and obesity.
Elements of the Collaboration
_____________________________
Lilly will receive the following:
-- Rights to Targretin(TM), an oral therapy currently in early
clinical development for Type II diabetes. Targretin is
the first in a new class of oral diabetes therapies.
-- Exclusive rights to two second generation oral diabetes
compounds in preclinical development that could offer further
improvements over currently available products.
-- Exclusive rights to Ligand's metabolic disease technology
to develop more advanced diabetes, cardiovascular and
related therapies.
-- Additional rights to use Ligand's technology to develop
a compound in combination with a Selective Estrogen Receptor
Modulator (SERM) in cancer.
Ligand may qualify to receive the following:
-- Up to $49 million in research funding over five years plus
the potential for up to three additional years of
research funding.
-- $37.5 million in an equity investment at $17.23 per share.
The price was calculated as a 20 percent premium to the
market average on 20 days trading ending September 12 as
defined in the contract.
$12.5 million in upfront milestones. Up to $75 million in additional milestone payments paid over
eight years assuming successful development of oral Targretin
and five other compounds.
-- Double-digit royalties for most advanced products and
single-digit royalties on earlier compounds.
-- An option to obtain select rights to one Lilly specialty
pharmaceutical product in certain markets of interest to
Ligand. The product would fit into an area of specific focus
for Ligand, but not Lilly.
-- Milestones, royalties and options to obtain certain
codevelopment and copromotion rights for a Lilly-selected
RXR compound in combination with a SERM.
''Our strategic alliance with Ligand is an exciting business opportunity that we believe will deliver substantial value to both companies,'' said Sidney Taurel, president and chief operating officer for Lilly. ''The collaboration provides us an important opportunity to transform our existing diabetes business into a broad franchise in all phases of metabolic disease.''
''We are pleased to enter into this important alliance with a global pharmaceutical leader,'' said David E. Robinson, Ligand chairman, president and chief executive officer. ''Lilly is deeply committed to the unmet medical needs of people with diabetes throughout the world. Lilly's global infrastructure, strong expertise and financial commitment to this alliance will allow Ligand to more fully develop our technology in metabolic disease, to strengthen our finances for the buy-out of ALRT and to continue our march toward profitability in 1999.''
Specifics of the Collaboration
______________________________
Lilly will receive worldwide, exclusive rights to Ligand's compounds and technology associated with the Retinoid X Receptor (RXR), a promising new target for the treatment of type II diabetes. The role of RXR agonists in animal models relevant to obesity and Type II diabetes has already been characterized by Ligand scientists as published earlier this year in the scientific journal, Nature. RXR compounds have potential both as mono-therapy diabetes treatments and in combination with other oral antidiabetic compounds including PPAR agonists such as thiazolidinediones (TZDs). Lilly and Ligand scientists have shown that a synergistic effect exists between RXR agonists and TZDs. Lilly and Ligand will join their research programs with the goal of discovering and bringing forward more advanced RXR compounds. Ligand retains exclusive rights to independently research, develop and commercialize Targretin and other RXR compounds in the fields of cancer and dermatology.
Lilly will also receive worldwide exclusive rights in certain areas to Ligand's PPAR (peroxisome proliferator activated receptor) technology, along with rights to use PPAR research technology with the RXR technology. Products that result from this research could offer people a significant advance for the treatment of diabetes versus existing therapies. Lilly and Ligand will also begin research programs aimed at discovering novel compounds that therapeutically activate PPAR subtypes for treatment of cardiovascular disease. Finally, Lilly will receive exclusive rights to the HNF4 (hepatic nuclear factor 4) receptor and the obesity gene promoter technology.
''Developing successful partnerships with leading scientific companies plays a very important role in our efforts to improve our innovative capabilities,'' said August M. Watanabe, M.D., executive vice president, science and technology, for Lilly. ''If successful, Lilly could bring to market a number of new oral diabetes, cardiovascular and other metabolic disease products.''
''This alliance allows Lilly and Ligand to pursue multiple drug discovery targets in several cell signaling pathways with important potential in metabolic disease. We are enthusiastic about the opportunity to work together in discovering drugs that operate through the RXR pathway and the more uncharted mechanisms of the RXR/PPAR heterodimer, HNF4 and the obesity gene pathway,'' added Andres Negro-Vilar, M.D., Ph.D., Ligand chief scientific officer and Jose F. Caro, M.D., vice president, endocrine research and clinical investigation for Lilly.
Ligand has the option to obtain selected rights to one Lilly specialty pharmaceutical product. The product would fit into a current area of strategic focus for Ligand and could be marketed within the next several years. Should Ligand elect to obtain selected rights to the product, Lilly could receive milestones up to $20 million in Ligand stock. In the event Ligand does not exercise this product option, during the first 90 days after the effective date of the agreement, Ligand will sell an additional $20 million in equity to Lilly at a 20 percent premium to the then market price and qualify for certain additional royalties of up to 1.5 percent on net sales on Ligand's choice of Targretin (LGD1069), LGD1268 or LGD1324.
The milestone calculations in this transaction are net of payments to third parties, and a percentage of certain royalty payments are due to third parties as a result of the recently announced restructured rights to compounds currently held by Allergan Ligand Retinoid Therapeutics, Inc. (ALRT) (NASDAQ:ALRI - news).
The closing of this transaction is subject to receipt of necessary regulatory approvals and is contingent upon Ligand successfully completing its recently announced buyback of outstanding shares of ALRT capital stock and the restructured rights to compounds currently held by ALRT.
The collaboration will also enable both companies to expand their research expertise in the field of intracellular receptors. Intracellular receptors (IRs) are members of a family of hormone-activated proteins that act inside the cell. Activated IRs control gene expression to maintain and restore balanced physiologic function. Drugs that mimic or block hormone action are useful in treating a variety of diseases that result from hormonal and other imbalances.
Since 1989, Ligand Pharmaceuticals Inc. has established a leadership position in gene transcription technology, particularly intracellular receptor (IR) technology and Signal Transducers and Activators of Transcription (STATs). Ligand applies IR and STATs technology to the discovery and development of small molecule drugs to enhance therapeutic and safety profiles and to address major unmet patient needs in cancer, women's health and skin diseases, as well as osteoporosis, cardiovascular, inflammatory and metabolic diseases.
Lilly is a global research-based pharmaceutical corporation headquartered in Indianapolis, Ind., that is dedicated to creating and delivering innovative pharmaceutical-based health care solutions that enable people to live longer, healthier and more active lives.
Except for the historical information contained herein, this press release may contain certain forward looking statements by Ligand or Lilly, and actual results could differ materially from these described as a result of factors including but not limited to the following. There can be no assurance that Targretin, LGD1268, LGD1324, or any development candidate identified as a result of the Lilly-Ligand collaboration will be successfully developed, that regulatory approvals will be granted, or that there will be a market if, in fact, the drugs are approved for marketing. Ligand undertakes any obligation to revise or update the press release to reflect events or circumstances after the date hereof. << |
