Gilead Sciences Inc. entered a licensing agreement with Japan Tobacco Inc. for rights to a new HIV drug.
The Foster City, Calif.-based company gained exclusive rights to develop and commercialize the HIV integrase inhibitor, called JTK-303, in every country except Japan, where Japan Tobacco retains rights.
"Their research capabilities are well aligned with our own expertise, which is one of the reasons they are an ideal partner for us," said Erin Edgley, Gilead's manager of public affairs.
Under terms of the agreement, Gilead will pay Tokyo-based Japan Tobacco a $15 million up-front payment and up to $90 million in additional cash milestone payments, as well as a royalty on future product sales. Edgley could not disclose the royalty rate, but she said the milestones were based on development, regulatory and sales achievements.
The companies first partnered in July 2003 in an agreement that granted Japan Tobacco commercialization rights for Truvada (emtricitabine and tenofovir fumarate), Viread (tenofovir disoproxil fumarate) and Emtriva (emtricitabine) in Japan. In that deal, it was Gilead receiving the up-front fee and milestone payments.
The licensed compound in the new deal, JTK-303, is from a class of drugs that targets the integrase enzyme.
"This is a newer viral target," Edgley told BioWorld Today, "and integrase is a key enzyme that is required by HIV to replicate. So the belief is, by inhibiting integrase, it could potentially protect healthy cells from infection."
JTK-303 has been evaluated in a Phase I study in Japan to assess bioavailability and pharmacokinetics in healthy volunteers. Gilead plans to start Phase I/II studies in HIV-positive patients by the middle of this year.
Gilead has a strong focus on developing therapies for HIV, particularly those in established classes of HIV drugs, such as nucleotide reverse transcriptase inhibitors. But it also wants to explore therapies such as JTK-303 with new mechanisms of action. The company believes JTK-303 has a profile that is complementary to its existing HIV products.
Gilead's HIV products include the marketed therapies Truvada, Viread and Emtriva. It also has four other marketed products: AmBisome for systemic fungal infections, Hepsera for hepatitis B, Tamiflu for influenza A and B, and Vistide for cytomegalovirus retinitis in patients with AIDS.
In December, Gilead formed a joint venture with New York-based Bristol-Myers Squibb Co. to combine its Truvada product with BMS' Sustiva. Approved last year to treat HIV in adults, Truvada consists of Emtriva and Viread. (See BioWorld Today, Dec. 21, 2004.)
"If you add that to Bristol-Myers' Sustiva that would represent the first complete HIV regimen taken as one pill once a day," Edgley said.
Last fall, Gilead formed two agreements to find compounds to treat hepatitis C, one with Achillion Pharmaceuticals Inc., of New Haven, Conn., and the other with Genelabs Technologies Inc., of Redwood City, Calif. (See BioWorld Today, Oct. 1, 2004, and Nov. 30, 2004.)
In response to the agreement with Japan Tobacco, Gilead revised its guidance to a range of $250 million to $270 million in research and development expenses in 2005. The previous guidance was between $240 million and $260 million.
The company's stock (NASDAQ:GILD) fell 22 cents Tuesday to close at $34.89.