SAN FRANCISCO -- Genentech Inc. agreed to back a $15 millioncollaboration with Glycomed to develop carbohydrate-basedtherapeutics based on cell adhesion molecules, the twocompanies announced Monday at the Hambrecht & QuistConference in Life Sciences here.
The three-year agreement includes an equity investment of $7million by Genentech of South San Francisco, Calif., in Glycomedof Alameda, Calif., and $8 million in research funding fromGenentech.
But Genentech President G. Kirk Raab made most of hispresentation into a plea to investors to consider Genentechstock "a unique investment opportunity."
Raab argued that Genentech stock presents investors withsignificant up-side potential and little down-side risk, makingthe company's stock particularly attractive to institutionalinvestors. After last February's announcement that RocheHolding Ltd. would purchase 60 percent of Genentech, manyanalysts predicted limited interest in Genentech stock. (Rochehas an option to eventually buy an additional 15 percentownership of Genentech stock on the open market, and the restof the company's stock at fixed prices up to $60 a share.
But Genentech seeks to maximize value for all stockholders,Raab said. "Our plan is to make Roche's $60-a-share option tobuy the rest of Genentech look cheap."
The Genentech-Glycomed agreement is the first collaborationunder Genentech's new strategy of obtaining complementarytechnology in partnership with development-stage companies,Raab said in a prepared statement.
Genentech will market carbohydrate-based anti-inflammatoryproducts developed by the collaboration in all areas of theworld except the Far East, where Glycomed retains rights.Glycomed also retains rights to anti-cancer applications andcertain inflammatory diseases that address small markets.
The three-day H&Q conference, which has attracted 1,200people, features 45 biotechnology companies out of a total of140 presenting companies.
-- Karen Bernstein BioWorld Staff
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