WASHINGTON _ Human Genome Sciences Inc. said Friday that ithad successfully completed 90,000 sequences in the human genome,qualifying the company for a third and final milestone payment of$25 million from its collaborator SmithKline Beecham Corp.
The news nudged HGS stock (NASDAQ:HGSI) up 10 percent, toclose at $35.81 per share.
The Rockville, Md.-based gene mapping company now qualifies forthe $25 million payment in the form of revenues and equity.
HGS chairman and CEO William Haseltine said the announcement"underlines the continued close and productive relationship betweenHGS and SmithKline and emphasized the effectiveness of HGSresearch organization."
Since the collaborative agreement was unveiled in 1993,Philadelphia-based SmithKline paid $37 million for a 7 percentequity share in Human Genome Sciences. The pharmaceutical giantalso paid an additional $63 million which included initial licensingfees, payment for rights to commercialize HGS technology inSoutheast Asia, and completing the first two milestones.
Products developed by SmithKline based on HGS technology alsocould provide income through royalties and co-promotion rights.SmithKline will focus its drug development on small molecules,therapeutic proteins, and diagnostic products, said Haseltine.
The agreement with SmithKline expires five years after theachievement of the third milestone.
Haseltine said his company is considering a number of othercollaborations this year including agreements involving animal andagricultural research. HGS is particularly interested "in the field ofinfectious diseases and is actively engaged in research in this fieldthat may lead to other collaborations, perhaps with SmithKline,"Haseltine said.
The $25 million cash infusion, to be completed during the firstquarter of 1996, will mean HGS will have $140 million in cash onhand, Haseltine said.
Earlier this year the company reaped just under $60 million for apublic stock offering. (See BioWorld Today, Oct. 2, 1995, p. 1.) n
-- Michele L. Robinson Washington Editor
(c) 1997 American Health Consultants. All rights reserved.