By Rainer B. Langen
BioWorld International Correspondent
BORNHEIM, Germany ¿ German companies GPC Biotech AG and Altana AG entered agreements valued at $120 million related to the establishment of a genomics research center in Waltham, Mass.
GPC Biotech stands to receive $70 million of this investment, providing Altana with licenses, capacities for collaboration and facilities related to the new research center.
The major component of the deal for Martinsried, Germany-based GPC is the licensing and collaboration piece, GPC CEO Bernd Seizinger said. ¿Under this agreement we will be transferring selective genomics and proteomics technologies to Byk Gulden,¿ Altana¿s pharmaceutical division.
The deal, which the companies said to their knowledge was the largest ever in the German biotech industry, includes a research alliance with Byk in two undisclosed therapeutic areas.
GPC retains all rights to its technologies and expects to own all rights to any improvements to its technologies to be developed at the center, the company said. It also has the right to commercialize other jointly developed technologies. Details on the kind of technologies licensed were not disclosed.
¿The committed funding in this collaboration and licensing agreement is $60 million,¿ Seizinger said. ¿This is real money that is going to flow to GPC Biotech during the next five and a half years.¿
The second component of GPC¿s deal with Bad Homburg, Germany-based Altana is a facility sublease and service agreement.
¿That¿s yet another $10 million,¿ Seizinger said. In addition, GPC may expect undisclosed research, preclinical and clinical milestone payments as well as royalties for each product resulting from the collaboration.
The collaboration aims at ¿implementing a new genomics-driven drug discovery and development paradigm,¿ Seizinger said. ¿What distinguishes this deal from most other deals is that there is this very large component of committed funding in addition to milestone payments and royalties.¿
The deal includes a $10 million up-front payment, he added.
Revenues from the deal are expected to fuel GPC¿s internal drug discovery and development pipeline. ¿[This pipeline] is providing the maximum upside potential for our investors, which is counterbalanced by very solid revenue generation,¿ Seizinger said.
It is GPC¿s fourth agreement with Altana. The companies announced their first collaboration in December 1998. It covers target finding and validation related to antibiotics against the bacterium Helicobacter pylori, which causes stomach ulcers. The second deal was signed in January, and it calls for GPC to find and validate drug targets for Byk Gulden in the area of oncology. The deal was said to be worth up to $100 million for GPC including a single-digit up-front payment in the millions. (See BioWorld Today, Jan. 24, 2001.)
On Nov. 1, Altana further tightened connections with a EUR34.2 million (US$30.9 million) equity investment in GPC, essentially buying 8.3 percent of GPC. (See BioWorld Today, Nov. 2, 2001.)
Altana, from its future genomics research center in the U.S., expects to ¿catch up with pharmaceutical companies with technologically fully integrated research,¿ Altana said.
¿With GPC Biotech we have found an ideal partner to gain the technological know-how within the field of genomics/proteomics,¿ Hans-Joachim Lohrisch, of Altana¿s managing board, said in a prepared statement. ¿We want to profit from GPC Biotech¿s experience as a trans-Atlantic biotech company, in order to strengthen our presence on the U.S. pharmaceuticals market with our own innovative products in the long run.¿
Altana plans to invest an additional $50 million in internal research funding to these drug discovery programs and the technology transfer over the next five and a half years.
¿Boston is an excellent location within the international research environment on the American East Coast,¿ Altana said.
Plans for the genomics research center near Boston call for GPC to sublease a separated area of up to 25,000 square feet of its nearly 85,000-square-foot Waltham facility for the center, which is expected to be staffed by up to 55 employees.
Altana AG is an international pharmaceuticals and chemicals group with sales of about EUR2 billion and more than 9,300 employees worldwide. Byk Gulden GmbH, of Constance, Germany, concentrates on therapeutics, diagnostics and self-medication, and focuses on research in the fields of gastrointestinal, respiratory and oncological diseases.