San Diego’s Neurocrine Biosciences Scores Second Big Deal in Two Days

6/18/10

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has enacted seemingly endless cuts that have reduced its workforce by nearly 80 percent in less than five years. Neurocrine employed 125 people at the end of 2009 compared to 588 at the end of 2005. Projects were shelved and good people were let go so the company could continue to invest in the clinical programs involved in the latest deals.

Napodano likes the Abbott deal because the majority of the company’s milestone payments are for drug development. That means Neurocrine will see the bulk of the money before FDA approval, which he says may come in 2012 or 2013. On top of that, Neurocrine gets a $75 million upfront payment. He estimates a royalty rate of 20 percent.

He likes Abbott as a partner for Neurocrine because Abbott markets luprolide, an injectible drug that works on the same receptor as the experimental as the Neurocrine drug, which is taken orally. Napodano writes that Neurocrine’s drug is a logical replacement in the OB/GYN market for luprolide, which will lose patent protection in 2015.

Endometriosis, a painful condition in which uterine tissue grows outside the womb, affects about 7.5 million women in the US, according to Neurocrine. The company has reported promising results from mid-stage studies; late-stage trials are expected to begin later this year.

Napodano estimated that Neurocrine will have $135 million in cash on its books at the end of the second quarter. The cash should help Neurocrine push … Next Page »

Denise Gellene is a former Los Angeles Times science writer and regular contributor to Xconomy. You can reach her at dgellene@xconomy.com Follow @

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