Gen-Probe Amends Deal to Get Promising Test for Prostate Cancer
Resolving a long-standing dispute, San Diego’s Gen-Probe (NASDAQ: GPRO) agreed to invest $5 million in its Canadian partner and to begin clinical trials of its prostate cancer test later this year.
The deal gives Gen-Probe a 10 percent stake in Toronto-based DiagnoCure and revises the timeline for developing the test, which had become a sticking point between the companies. The test relies on measuring urine levels of PCA3, a gene linked to prostate cancer. Gen-Probe acquired exclusive diagnostic rights to the gene from DiagnoCure in 2003.
As part of the initial agreement, Gen-Probe promised to advance the test toward FDA approval according to a time table – but that timeline soon became a source of dispute.
DiagnoCure claimed that Gen-Probe failed to stay on schedule, putting its exclusive rights to PCA3 in jeopardy. Gen-Probe insisted it missed no deadlines.
Now all is forgiven. DiagnoCure gets a helpful cash infusion while Gen-Probe, a maker of blood-screening tests and diagnostic tests, acquires greater certainty over the project as it moves forward. The terms call for Gen-Probe to make annual payments of $500,000 to DiagnoCure until all its milestones are met, with half of the amount paid applied to future royalties.
Gen-Probe announced the agreement today after the market close.
The deal came just days after several promising studies about the test were presented at the annual meeting of the American Urological Association in Chicago. The data suggested that the test might be good at detecting aggressive cancers and while limiting “false positive” results that can lead to over-treatment.
There’s no question improved tests are needed.
The primary test for … Next Page »