Bayer HealthCare acquires hematology development portfolio featuring MAXY-VII from Maxygen

Phase 1 clinical testing expected to commence in third quarter of 2008 / Transaction includes license to Maxygen’s novel biotechnology research platform.

Leverkusen / Redwood City, California, USA. – Bayer HealthCare is expanding its commitment to hemophilia with the acquisition of Maxygen’s hemophilia program assets, including a next-generation recombinant Factor VIIa protein known as MAXY-VII. The lead therapeutic candidate is expected to enter Phase 1 clinical testing in the third quarter of 2008. The total transaction is valued at US-Dollar 90 million upfront with a final, potential milestone payment of US-Dollar 30 million. This agreement includes a license to use Maxygen’s MolecularBreeding™ technology, a novel research platform, for exploiting gene targets.

Hemophilia is an inherited bleeding disorder caused by deficient or defective blood coagulation proteins. Roughly 20 to 30 percent of patients with hemophilia develop antibodies – or inhibitors – to current therapies. In these instances a Factor VIIa is used to bypass inhibitors and help these individuals to form clots. MAXY-VII is a next generation Factor VIIa clotting factor that may offer an improved dosing regimen and safety profile. The addition of a development candidate for patients with clotting factor inhibitors could further build Bayer’s leadership position in hemophilia care where it offers the recombinant Factor VIII product, Kogenate® (antihemophilic factor [recombinant]). The company has a strong development program dedicated to hemophilia including ongoing clinical investigations into long-acting forms of Kogenate.

“MAXY-VII has the potential to be an important expansion of therapeutic options for people living with hemophilia and we are pleased to add this to our global development portfolio. The agreement fits into our growth strategy for our specialty pharmaceutical business and builds on our expertise in the commercialization and manufacturing of protein therapeutics,” said Dr. Gunnar Riemann, member of the Executive Committee of Bayer HealthCare. “Our scientists are actively collaborating with researchers in academia and biotechnology firms to leverage novel research platforms. Access to Maxygen’s MolecularBreeding™ technology provides us with another tool to expand our product pipeline.”

“This agreement allows Maxygen to capture significant value from this preclinical asset, and puts MAXY-VII in the hands of the hemophilia leader,” said Russell Howard, chief executive officer of Maxygen. “MAXY-VII has the potential to become the world’s first approved shuffled protein therapeutic, a milestone that is likely to open up many more opportunities for Maxygen’s technology. Bayer is the ideal company to move the MAXY-VII program toward that goal.”

Bayer also receives a non-exclusive license to use Maxygen’s MolecularBreeding™ technology for a broad set of genes for its internal use in its specialty pharmaceutical business. In addition, Bayer receives exclusive rights to use the technology for 30 specified gene targets in areas of strategic business interest. This novel platform allows scientists to exploit gene variation that can result in unique drug targets or novel therapeutic protein candidates.