Paion Deutschland GmbH stands to receive up to €65 million (US$78.5 million) in a deal that would allow H. Lundbeck A/S marketing rights to its plasminogen activator, Desmoteplase, to treat stroke patients in Europe and Asia.
Paion last year entered a commercialization deal with New York-based Forest Laboratories Inc., but the partnership with Lundbeck secures global development support for Desmoteplase, which is in a Phase III trial in acute ischemic stroke, said Peer Schroeder, investor relations manager for Paion.
"While Forest is responsible for the U.S. and Canada, Lundbeck is now responsible for the rest of the world, including Europe and Asia," he said.
The agreement calls for Copenhagen, Denmark-based Lundbeck to pay an up-front fee of €15 million, and then additional milestones of up to €50 million. The milestone amount depends on the number of co-promotion options Paion chooses to exercise.
The Aachen, Germany-based company retains the right to choose a co-promotion plan in certain countries and, in those cases, "we will split the profits 50/50, in exchange for a proportionate share of the development costs," Schroeder told BioWorld Today. Paion's share of development could amount to about 18 percent of the joint costs. The company will decide which countries will be the best co-promotion opportunities after further development and market analysis.
"In other countries, where we don't exercise [the co-promotion option], we will receive double-digit royalties," he said.
The deal with Forest, signed in July 2004, included up-front and milestone payments to Paion of up to $69.5 million, and Forest also agreed to fund 100 percent of the development costs, with Paion to repay about half those costs following the approval of Desmoteplase in Europe and Japan.
"What we have agreed with Lundbeck is that they will step [up] to the repayment obligation," Bernhard Hofer, Paion's chief financial officer said, during a conference call. "We will take over part of that repayment obligation where we have co-promotion.
"So the financial risk of development is taken over by Forest at first, then, after approval, it is taken over by Lundbeck," Hofer added.
Paion licensed Desmoteplase from Berlin-based Schering AG in 2000. The drug, described as the first in a class of plasminogen activators, is a genetically engineered version of Desmodus rotundas, a clot-dissolving protein found in vampire bat saliva. Previous studies, including two Phase II trials, have demonstrated that Desmoteplase can dissolve a blood clot without the high risk of intracranial bleeding commonly seen with clot-dissolving products.
"We're targeting a treatment window of up to nine hours," Schroeder said. The only approved thrombolytic, tPA, by South San Francisco-based Genentech Inc., must be administered within three hours of an ischemic stroke, meaning that about 80 percent of stroke patients are not able to take it.
"We believe we can raise the number of patients that might benefit from clot-dissolving treatment," he added.
In the Phase II studies, a total of 142 acute ischemic stroke patients were randomized within three to nine hours from the onset of stroke symptoms. Patients who received one of two doses of Desmoteplase demonstrated faster rates of reperfusion, or restored blood flow.
The ongoing Phase III study, DIAS-2 (Desmoteplase in Acute Ischemic Stroke) aims to confirm those earlier results in a 1,200-plus patient group. Paion has not released an estimated time frame for the pivotal trial, though Schroeder said the company could be filing for marketing approval as early as the end of 2007.
Paion, which began listing on the Frankfurt Stock Exchange in February following a $52.7 million initial public offering, recently began clinical development of its second product, Enecadin, a sodium and calcium channel blocker designed to act as a neuroprotectant in acute ischemic stroke patients. Phase II studies are set to begin during the second half of this year. The company also expects to start Phase I studies of Solulin in stroke and other thrombotic diseases.
Shares of Paion gained €0.78 on the Frankfurt Stock Exchange Monday to close at €8.33.