OctoPlus announces exclusive license and manufacturing agreement for Locteron with Biolex allowing for revenues in excess of 100 million euro
Leiden, the Netherlands
This agreement will immediately transform OctoPlus into a cashflow positive company
OctoPlus N.V. (“OctoPlus” or the “Company”) (Euronext: OCTO), the drug delivery company, announces today that it has signed an exclusive license and product acquisition agreement to license its share of the commercial rights to its lead product Locteron® to co-development partner Biolex Therapeutics. OctoPlus will remain a partner in the process development and manufacture of Locteron, but without having to make the investments for the upcoming late-stage clinical program. The proceeds of the agreement include among others upfront and milestone payments that amount to a total of US$ 149 million (€ 108 million) in the coming years, and royalties on future Locteron sales. The upfront fee and short-term milestone payments comprise the first significant revenues that OctoPlus generates from the commercialisation of its drug delivery technology PolyActive®. In addition to the cash payments under the agreement, OctoPlus will receive an equity stake in Biolex of up to 3.0%.
License and manufacturing agreement
A co-development agreement for Locteron has been in place between OctoPlus and Biolex since 2005. Highly promising clinical trial results have been published during the collaboration so far and the product is now being evaluated in a US Phase IIa study. Under the terms of the agreement announced today, Biolex will be responsible for the overall development and commercialisation of Locteron. OctoPlus will continue to perform process development and will manufacture Locteron, but will now be paid for these activities.
In summary, OctoPlus will receive:
- An upfront fee of US$ 11 million (€ 8.0 million)
- Milestone payments totaling US$ 138 million (€ 100 million)
- An equity stake in Biolex of up to 3.0%
- Royalties on net product sales. Moreover, OctoPlus retains commercial manufacturing rights to Locteron. The combined revenue from royalties and sale of manufactured product to Biolex will be equivalent to a low double-digit royalty.
Simon Sturge, CEO of OctoPlus*, comments: “We are very excited to have established this license agreement for Locteron with Biolex. This deal is beneficial for OctoPlus in two ways:
- Firstly, we will continue to be involved in the development of a potential blockbuster, but without having to make the expenditures of late-stage clinical development, and
- Secondly the upfront fee, funding of process development and manufacturing activities and milestone payments will transform us into a company with a positive operational cashflow.
This agreement concludes our financing activities and enables us to maintain our focus on being a world-class drug delivery company, using our technologies for the development of our own products and for our partners.”
*On September 16 OctoPlus announced the nomination by the Board of Supervisory Directors of Mr. Sturge as proposed CEO. His appointment will be made official at the Company’s Annual General Meeting of Shareholders, which will be scheduled shortly.
With this agreement OctoPlus secures long-term revenues for the Company and reduces its expenditure. In addition, the upfront and milestone payments transform OctoPlus instantly into a business with a positive operational cashflow for the foreseeable future. With the completion of this agreement, the Company is now in a position to publish its Annual Report 2007, for which a publication date will be announced shortly.
Conference call and webcast presentation
OctoPlus will hold a conference call and webcast presentation today at 10:00 AM CET. This event can also be followed live via OctoPlus’ website www.octoplus.nl. If you would like to participate in the conference call, please dial in on telephone number +31 (0) 45 631 6902. After the presentation, Simon Sturge, CEO of OctoPlus, will be available to answer questions. After the event, the webcast will be available for replay on the Company’s website.
Locteron is designed to be a best-in-class therapeutic for patients with chronic hepatitis C, with the potential to induce less side effects, improve patient compliance and provide a more convenient once-every-two-week dosing schedule compared with current therapies. Locteron combines OctoPlus’ proprietary PolyActive® drug delivery technology with BLX-883, a recombinant alfa interferon produced by OctoPlus’ co-development partner Biolex Therapeutics in Biolex’s patented LEX SystemSM. Locteron is produced in OctoPlus’ cGMP manufacturing facilities in Leiden, the Netherlands.
OctoPlus N.V. is a product-oriented biopharmaceutical company committed to the creation of improved pharmaceutical products that are based on OctoPlus’ proprietary drug delivery technologies and have fewer side effects, improved patient convenience and a better efficacy/safety balance than existing therapies. Rather than seeking to discover novel drug candidates through early stage research activities, OctoPlus focuses on the development of long-acting, controlled release versions of known protein therapeutics, other drugs, and vaccines.
Our pipeline consists of 5 products in pre-clinical and clinical development. The lead product incorporating our technology is Locteron, a controlled release formulation of interferon alfa for the treatment of chronic hepatitis C, which has been licensed to Biolex Therapeutics and is being manufactured by OctoPlus. Locteron is currently in Phase II clinical studies. Furthermore, our pipeline comprises a product candidate for the treatment of chronic middle ear infection, which is in Phase II clinical development, a pre-clinical GLP-1 analogue product candidate for the treatment of diabetes and two pre-clinical-stage single-shot vaccines.
In addition, OctoPlus is a European leading provider of advanced drug formulation and clinical scale manufacturing services to the pharmaceutical and biotechnology industries, with a focus on difficult-to-formulate active pharmaceutical ingredients.
OctoPlus is listed on Euronext Amsterdam by NYSE Euronext under the symbol OCTO. For more information about OctoPlus, please visit our website www.octoplus.nl.
This document may contain certain forward-looking statements relating to the business, financial performance and results of OctoPlus N.V. and the industry in which it operates. These statements are based on OctoPlus N.V.’s current plans, estimates and projections, as well as its expectations of external conditions and events. In particular the words “expect”, “anticipate”, “predict”, “estimate”, “project”, “plan”, “may”, “should”, “would”, “will”, “intend”, “believe” and similar expressions are intended to identify forward-looking statements. We caution investors that a number of important factors, and the inherent risks and uncertainties that such statements involve, could cause actual results or outcomes to differ materially from those expressed in any forward-looking statements. In the event of any inconsistency between an English version and a Dutch version of this document, the English version will prevail over the Dutch version.
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