Here's the press release on the first milestone payment:
LIGAND ELECTS TO RECEIVE MILESTONE PAYMENTS FROM PFIZER IN
LIGAND COMMON STOCK; LIGAND COULD RETIRE OVER 101,000 SHARES
SAN DIEGO, May 7 /PRNewswire/ -- Ligand Pharmaceuticals Inc.
(Nasdaq: LGND) today announced that it has elected to have its
next two
milestone payments from Pfizer Inc (NYSE: PFE) paid in Ligand
stock,
currently held by Pfizer.
Under the terms of a recently settled lawsuit, Ligand has
been
deemed to have earned a second milestone payment of $350,000
(payable by
May 7, 1996) and will receive a further milestone payment of
$900,000 on
Sept. 1, 1996 with respect to droloxifene if droloxifene
continues to be
under development for osteoporosis and other indications except
breast
cancer.
Pfizer currently holds 1,353,100 shares of Ligand Common
Stock, and
under the terms of the settlement, either Ligand or Pfizer may
elect to
have these two milestone payments and subsequent developmental
milestone
payments (up to $6,150,000) and royalty payments on droloxifene
or
CP-336,156 made by Pfizer delivery of Ligand stock valued at the
market
price on the date of settlement ($12.375). To permit this
election,
Pfizer has agreed to hold the Ligand Common Stock it currently
owns for
a period of seven years from settlement or until it discontinues
development of all products that are eligible for milestone or
royalty
payments, whichever occurs first.
At a price of $12.375 per share, the first two milestones
will
amount to 101,009 shares of Ligand stock which the Company
intends to
retire. The first milestone will amount to 28,272 shares. If
droloxifene continues to be developed in indications in addition
to
breast cancer, Ligand will receive the second milestone which
would
amount to 72,727 shares. Ligand will record the milestone
payment at
the closing price of the stock on the date the stock is received.
"We are pleased at the prospect of retiring over 100,000
shares this
year and hope that, if these compounds progress through clinical
and
commercial development, we will be able to continue to retire
substantial additional shares," according to Paul V. Maier,
Ligand Chief
Financial Officer. "We are especially pleased with progress in
the
development and commercialization of these compounds,
particularly for
osteoporosis, one of the truly exciting growth markets of the
1990s and
the next century."
Ligand and Pfizer announced that effective April 19, 1996
they
settled the lawsuit brought by Ligand against Pfizer for breach
of
contract. The lawsuit, filed in December 1994, claimed that,
under the
terms of the Ligand-Pfizer collaborative agreement initiated in
1991,
Ligand was entitled to certain payments and royalties in
connection with
droloxifene. Droloxifene, a compound Pfizer licensed from Klinge
Pharmaceuticals in Germany, is a compound Ligand worked on at
Pfizer's
request during the research phase of the Ligand-Pfizer
collaboration.
Droloxifene is currently in Phase III clinical trials for breast
cancer
and Phase II clinical trials for osteoporosis.
Under the original terms of the 1991 collaborative
agreement, Pfizer
would fund and have exclusive rights to conduct the development,
manufacture and commercialization of collaboration products.
Ligand
would receive milestone payments of up to $7.5 million as
development
objectives were achieved, and royalties of 6% on sales of
successful
drug(s) that emerged from the alliance. A first milestone
payment of
$100,000 was earned by Ligand in 1993.
Milestone and royalty payments for droloxifene are
contingent upon
droloxifene's advancement toward regulatory approval and sales
as a drug
in breast cancer, osteoporosis or other indications. The
royalty rate
will be 1% on droloxifene worldwide sales for breast cancer. If
Pfizer
makes sales of droloxifene for any indication other than breast
cancer,
including osteoporosis, the royalty will then be 3% for all
indications.
Although not at issue in the lawsuit, the parties have
reaffirmed
that Ligand will be entitled to any remaining milestone
payments, to the
extent not earned as a result of the development of droloxifene,
and
full royalties of 6% on all indications for the Pfizer compound
CP-336,156, identified as a result of the Ligand-Pfizer
osteoporosis
collaboration, if that compound should also advance toward
regulatory
approval. Pfizer has confirmed that it expects to initiate
Phase I
clinical trials with CP-336,156 in Europe in the fourth quarter
of 1996
and expects to begin U.S. trials in the second quarter of 1997.
Ligand and Pfizer initiated their 1991 collaboration to apply
Ligand's intracellular receptor (IR) technology to the pursuit
of drugs
for the treatment of osteoporosis. The research phase of the
collaboration ended in 1993, with the announcement that the
research
objectives had been achieved and a candidate had been identified
for
development by Pfizer.
Pfizer Inc is a diversified, research-based health care
company with
global operations. The company reported sales of nearly $10.2
billion
for 1995.
Ligand Pharmaceuticals Inc., founded in 1987, is a leader 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 and
inflammatory disease.
This statement contains certain forward looking statements
by Ligand
and actual results could differ materially from those described
as a
result of factors, including, but not limited to the following.
There
can be no assurance that droloxifene, or any development
candidate
identified as a result of the Ligand-Pfizer collaboration, will
be
successfully developed, that regulatory approvals will be
granted, or
patient and physician acceptance of these products will be
achieved.
CONTACT: Paul Maier of Ligand Pharmaceuticals, 619-550-7573
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