Marion Merrell Dow Inc. could pay more than $60 million toImmuLogic Pharmaceutical Corp. under a deal announcedWednesday to jointly develop ImmuLogic's allergytherapeutics.
Under the preliminary agreement, MMD will purchase 1 millionImmuLogic shares for $18 million. In addition, MMD onWednesday paid $1.2 million for a three-year option to buy250,000 additional shares at $35 per share. ImmuLogic ofCambridge, Mass., has 8.8 million shares outstanding before thedeal.
The stock (NASDAQ:IMUL) closed at $17.25, up $1, onWednesday.
Upon execution of a final agreement in early 1992, MMD willpay a $7 million up-front license fee to ImmuLogic.
The agreement also provides for additional license fees andmilestone payments that could total $25 million to $35 million.Some of those additional funds will be reimbursable to MMDfrom profits that would otherwise go to ImmuLogic, saidRichard Bagley, president and chief executive officer ofImmuLogic.
"We're pairing our science and discoveries with the capabilitiesof the market leader in allergies," Bagley told BioWorld. MMDmarkets Seldane, which holds a 41.5 percent share of the worldprescription antihistamine market, according to companyfigures.
ImmuLogic's Allervax compounds consist of an epitope, a pieceof the individual protein that causes a specific allergic reaction.The compounds are delivered subcutaneously, where they tellT cells that they are seeing a normal amino acid sequence towhich they shouldn't respond.
Traditional allergy shots do the same thing, but the extracts usewhole proteins that also bind to IgE antibodies, which triggerthe release of histamines by mast cells. Allervax epitopes don'tbind to IgE antibodies, thus avoiding the release of histamines.About 1.5 million U.S. patients currently receive allergy shots.
The most advanced Allervax product, Catvax for the treatmentof cat allergies, is expected to enter clinical trials in early 1992.ImmuLogic is also developing products to treat allergies toragweed, dust mite and grasses.
Under the collaboration, ImmuLogic will develop andmanufacture Allervax products in the United States. Theproducts will be jointly marketed in the United States byImmuLogic and MMD. ImmuLogic will retain 50.1 percent ofU.S. profits.
MMD (NYSE:MKC) of Kansas City, Mo., will be responsible fordevelopment and marketing outside of the United States andwill retain 55.1 percent of the associated profits.
A committee consisting of an equal number of members fromboth companies will oversee the collaboration.
-- Karen Bernstein BioWorld Staff
(c) 1997 American Health Consultants. All rights reserved.