Pharmacia & Upjohn added to its collection of AIDS-related drugsby agreeing to pay Gilead Sciences Inc. $60 million for rights to sellVistide for cytomegalovirus (CMV) retinitis outside the U.S.
The FDA approved Vistide June 27, 1996, for AIDS-related CMVretinitis, which is a potentially blinding condition for as many as 40percent of HIV-infected patients.
Analysts have estimated Vistide (cidofovir), which Gilead markets inthe U.S., could generate as much as $50 million in revenues for thecompany during 1997.
Gilead, of Foster City, Calif., launched Vistide, which is an antiviralnucleotide analogue, upon approval and reported $1.4 million in salesfor the two days it was on the market in the second quarter, endingJune 30, 1996.
Gilead's president and CEO, John Martin, estimated the combinedU.S. and European market for CMV retinitis drugs is about $165million a year.
The marketing deal with Pharmacia & Upjohn, of Kalamazoo, Mich.,covers two Vistide formulations, intravenous and intraocularinjection, for CMV retinitis.
The collaboration does not include other forms of cidofovir, such astopical versions for herpes and conjunctivitis, and other nucleotideanalogues, such as Gilead's AIDS drug.
However, Martin indicated other agreements may be possible. Henoted Pharmacia & Upjohn is excited about forging an alliance onnucleotide analogues, which represent a new class of antiviral drugs.
"They are making an equity investment," Martin added, "and that is asign we want to work together."
Gilead has a collaboration with American Home Products Corp., ofMadison, N.J., for development of topical cidofovir forconjunctivitis, commonly called pink eye.
Under terms of the Vistide deal with Pharmacia & Upjohn, Gileadwill receive a $10 million license fee up front. Following the drug'sapproval by the European Community's Committee for ProprietaryMedicinal Products (CPMP), Pharmacia & Upjohn will pay Gileadanother $10 million in cash and purchase $40 million in stock at apremium of 45 percent to the market value.
Based on Gilead's $17.62 closing market price Wednesday,Pharmacia & Upjohn would buy about 1.56 million shares at $25.50per share. Gilead's stock (NASDAQ:GILD) jumped $1.50 Thursdayto close at $19.125 on news of the Vistide deal. Pharmacia & Upjohn(NYSE:PNU) ended the day at $43.37, up 25 cents.
Gilead filed in December 1995 for approval of Vistide with theCPMP, which is the centralized regulatory group for the EuropeanUnion. Following clearance by the CPMP, price approvals must besought country by country.
Analysts have estimated CPMP clearance in the first quarter of 1997.Pharmacia & Upjohn will be responsible for all subsequentregulatory filings in Europe and elsewhere outside the U.S. Gileadwill receive royalties from Pharmacia & Upjohn and the companiessaid "additional financial terms" were negotiated, but they were notdisclosed. Analysts have estimated royalty payments at more than 25percent.
Martin said Pharmacia & Upjohn was an attractive partner because ithas "a demonstrated track record in selling drugs to advanced AIDSpatients."
Pharmacia & Upjohn markets Mycobutin for Mycobacterium aviumcomplex, an AIDS-related systemic infection, and it has filed for U.S.approval of a non-nucleoside analogue, called Rescriptor, for HIV. Italso is developing an HIV protease inhibitor.
Gilead's own AIDS drug, a nucleotide analogue called GS 840(adefovir dipivoxil), is in Phase III trials. n
-- Charles Craig
(c) 1997 American Health Consultants. All rights reserved.