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Biotech / Medical : Elan Corporation, plc (ELN) -- Ignore unavailable to you. Want to Upgrade?

To: William Partmann who wrote (422)	7/26/1999 8:49:00 AM
From: William Partmann	Read Replies (2) \| Respond to of 10345

Targeted Genetics Forms Partnership with Elan to Develop Advanced Gene Delivery Technologies; Elan to Make a Major Investment in Targeted Genetics SEATTLE, July 26 /PRNewswire/ -- Targeted Genetics Corporation (Nasdaq: TGEN - news) today announced that it has signed definitive agreements with Elan Corporation, plc (NYSE: ELN - news) to form a new subsidiary of Targeted Genetics with the goal of developing new technologies for the enhanced delivery of therapeutic genes. Targeted Genetics will own 80.1% of this new company, which is expected to be named Emerald Gene Systems, subject to completion of appropriate trademark searches. Emerald will be Elan's exclusive effort in the area of gene delivery for a period of at least three years. Elan has made an initial $5 million investment in Targeted Genetics common stock at a substantial premium to market price. Elan has also agreed to purchase an additional $5 million of common stock from Targeted Genetics at a premium to market one year from the date of the agreements. Additionally, Elan purchased $12 million of Targeted Genetics convertible exchangeable preferred stock. The proceeds from the sale of the preferred stock will be used by Targeted Genetics to fund its initial investment in Emerald. Elan has the right to either convert the preferred stock into additional common shares of Targeted Genetics or exchange it for increased ownership in Emerald to 50%. In recent years, Targeted Genetics has made substantial progress in the development of both viral and non-viral gene delivery technologies. Elan, a world leader in drug delivery technology, has developed a series of promising drug delivery technologies, which have significant potential in the area of therapeutic gene delivery. The companies believe that the combination of the two technologies and the related expertise of both companies have enormous potential to yield new platforms of advanced gene delivery vehicles for the systemic delivery of genes with highly specific tissue targeting capabilities. Emerald's initial research and development program will be focused on the creation of these enhanced delivery systems, and is expected to lead to the development of products utilizing its proprietary systems. ''We are pleased to have formed this collaboration with Targeted Genetics since it allows Elan to leverage its broad range of drug delivery technology into the gene delivery arena,'' said John Devane, Ph.D., Executive Vice President, Research and Development of Elan Pharmaceutical Technologies. ''Coupling Elan's capabilities with Targeted Genetics advanced viral and non-viral gene delivery systems allows us to jointly develop optimal delivery of gene-based therapies through a variety of routes of administration and directed towards a range of targets. Targeted Genetics has, in our opinion, a broad and promising portfolio of gene delivery vectors. As demonstrated by its ongoing development of tgAAV-CF for cystic fibrosis and tgDCC-E1A for cancer, Targeted Genetics has demonstrated the potential to navigate successfully the developmental, manufacturing and regulatory issues that accompany gene-based therapeutic products. We are very pleased to become partners with Targeted Genetics and we look forward to sharing in their success.'' Funding for Emerald will be provided by both Targeted Genetics and Elan in proportion to their ownership interest. Elan will provide Targeted Genetics with up to $12 million of convertible debt financing for the purpose of funding Targeted Genetics' share of Emerald's ongoing research and development expenses. With the equity and debt funding provided under the agreements, Targeted Genetics projects that it will have cash available to fund its operations for approximately two years. ''The creation of this partnership with Elan, one of the world's leading drug delivery companies, is a tremendous opportunity for Targeted Genetics,'' said H. Stewart Parker, President and Chief Executive Officer of Targeted Genetics. ''Elan's investment in Targeted Genetics and Emerald validates the significant value of our gene delivery platform and the related expertise that we have gained through the development of gene-based products. We believe that by combining our gene delivery vectors with Elan's proprietary technologies, we create the potential to build a powerful platform of enhanced gene delivery systems that will be administered systematically and target very specific cells in the human body. We expect our partnership with Elan to provide us with the technical and financial resources to make such approaches a reality, benefiting both patients and our shareholders.'' Targeted Genetics Corporation develops gene and cell therapy products for the treatment of certain acquired and inherited diseases. The company has three lead product development programs targeting cystic fibrosis, cancer, and infectious disease, as well as an extensive technology platform.