BioWorld International Correspondent

LONDON - Astex Therapeutics Ltd. landed a $520 million deal with Novartis AG for three cell-cycle inhibitors, the largest advertised figure for any deal involving a UK biotech to date, and bringing the total potential value of licenses granted by Astex in the past year to more than $1 billion.

Astex will receive an up-front payment of $25 million, part of which will be an equity investment, followed by research fees, option payments and potential milestones. If three products make it to market, the total deal value could reach $520 million. There also would be royalties on sales, with Astex retaining an option to co-commercialize compounds in the U.S.

Novartis, of Basel, Switzerland, has taken a worldwide license to AT9311, an orally available cyclin dependent kinase (CDK) inhibitor that is completing preclinical studies, and an option to license AT7519, a parenteral CDK inhibitor, in Phase I trials. AT9311 and AT7519 have different modes of action. In addition, the partners will establish a drug discovery alliance to identify novel inhibitors of CDK-4 and CDK-6.

Harren Jhoti, chief scientific officer and acting CEO, told BioWorld International: "We are delighted. The cell cycle is clearly one of the most exciting areas in cancer at the moment, but until recently, the sector has struggled to come up with good inhibitors." The deal also covers other diseases.

The company has a fragment-based approach to structure-based drug design that involves applying high-throughput X-ray crystallography to solve protein structures and using the structures to detect binding of low-molecular-weight drug fragments, which are then optimized into leads through conventional medicinal chemistry.

Cambridge-UK based Astex will be responsible for completing preclinical development, filing an investigational new drug application, and conducting the initial Phase I study of AT9311. The IND is expected to be filed at the beginning of 2006. In addition, the company will be responsible for continuing the development of AT7519 to the end of Phase II, when it will be handed over, if Novartis exercises its option.

The agreement leaves Astex with enough funding for the next two years. By the end of 2006, Astex expects to have three compounds in the clinic, and the company has expressed an interest in going public.

"This further validates the value of our assets and will help analysts and the market put a value on our portfolio - they've got to start valuing projects that are preclinical," Jhoti said. "This sets us up very nicely for an initial public offering if the markets are improved and we get the kind of valuation we deserve."

In August, Astex agreed to a deal worth a potential $270 million with AstraZeneca plc, of London, for a range of small-molecule protein kinase B inhibitors that are in preclinical development, also for treating cancer.

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