Concert Pharma To Get $300M+ Per Drug in Celgene Pact
The past 15 months have turned into a partnership symphony for Concert Pharmaceuticals.
On Monday, the Lexington, MA-based company snagged its latest collaborative partner, revealing that it will team with Celgene (NASDAQ: CELG) to use its technology— which adds deuterium elements into existing drugs to boost their abilities—to develop cancer and inflammation drugs.
Concert has now formed three high-profile partnerships with its technology since February 2012, having already struck similar pacts with Jazz Pharmaceuticals (NASDAQ: JAZZ) and Avanir Pharmaceuticals (NASDAQ: AVNR).
“Really this is, for us, a story of momentum and maturation of our technology,” says Concert CEO Roger Tung, of the string of partnerships.
But the Celgene deal has the potential to be Concert’s biggest haul to date, depending how things pan out, because Concert could receive a nine-figure check for each of several drugs the two develop through the partnership.
Initially, Concert will get an unspecified upfront payment while the two work on one unnamed drug, but the partnership could expand significantly from there. Should Celgene buy in to Concert’s technology and “exercise its program options,” Concert could get up to $300 million in development, regulatory and sales milestones for each drug the Summit, NJ-based biotech utilizes Concert’s technology to help develop and advance, as well as royalties should Celgene ultimately ever sell those drugs. Concert provided little additional information about the drugs the two will develop, only indicating that the two companies will target the areas of cancer and inflammation, and Tung declined to specify further on Monday. RBC Capital analyst Michael Yee speculated in a research note Monday that one of the drugs is Concert’s CTP-221, a deuterium-modified version of Celgene’s blockbuster myeloma drug lenalidomide (Revlimid). Concert said in December that it expects to finish pre-clinical testing of CTP-221 and seek FDA clearance to begin clinical trials in 2013.
Tung says Concert will meet with Celgene on a regular basis and as Celgene judges the potential of the technology to help develop its various products, it will decide whether to either expand the terms of the collaboration or not. The two will then use Concert’s technology to infuse deuterium into drugs that they have an interest in.
“We’re confident that what we’ll see is substantial benefits associated with deuterium modification as we have with other partner programs in our own hands,” he says. “So we think there’s a good likelihood that this can continue to expand.”
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