Alteon Inc. said Friday that Marion Merrell Dow Inc. hasexercised an option to expand their strategic alliance to includeEurope and certain other markets.
MMD will pay Alteon $5 million for the exercise of the option.
In December 1990, Alteon and MMD formed an alliance inNorth America to develop and commercialize Alteon'stechnology for therapeutics to treat the complications ofdiabetes and aging. MMD has a 7.7 percent equity stake inNorthvale, N.J.-based Alteon.
Alteon shares (NASDAQ:ALTN) rose $1 to $23.75 on Friday. Thecompany went public in November in an initial public offeringthat epitomized the biotech stock feeding frenzy just prior tothe Nov. 15 market correction.
After raising $45 million in an offering of 3 million sharespriced at $15, the stock opened at $26.50 on its first day oftrading and hit a high of $30.25 before closing at $28.75 on avolume of 4.7 million shares. Alteon had originally proposed tosell 2.5 million shares priced between $12 and $14 per share.
Alteon's products are designed to inhibit, reverse and measuredamage to cells, tissues and organs caused by advancedglycosylation end products. AGEs are formed as a result ofglucose in the body's circulatory system. They damage proteinsby forming permanent attachments, or cross-links, with otherproteins.
Aminoguanidine, Alteon's lead compound, inhibits AGEformation and cross-linking.
The new agreement with MMD will expand the jointdevelopment of aminoguanidine and possibly other compoundsto the United Kingdom, Germany and France. Alteon hasretained the option to co-market these compounds with MMD.
MMD will have an exclusive license in certain other Europeanmarkets and in Australia, New Zealand, Mexico and Brazil.
Alteon expects to begin next spring Phase II/III trials ofaminoguanidine to treat diabetic nephropathy and thecomplications of end-stage renal disease in diabetic patientsrequiring hemodialysis.
Yamanouchi Pharmaceutical Co. Ltd. has an exclusive license inJapan and three other Asian markets to the same productscovered by the MMD agreement.
-- Karen Bernstein BioWorld Staff
(c) 1997 American Health Consultants. All rights reserved.