VIRAX JUMPS 35% ON NOVARTIS $1bn TRANSGENE DEAL
March 14th 2010 22:33
Thursday March 11, 2010
Daily news on ASX-listed biotechnology companies
* ASX DOWN, BIOTECH UP: PSIVIDA UP 7%; GENETIC TECHNO DOWN 7.5%
* VIRAX JUMPS 35% ON NOVARTIS $1bn TRANSGENE DEAL
* PHARMAXIS COMPLETES ASTHMA DRUG DOSE-PROFILE
* CBIO’S 75th PATIENT TRIGGERS $1.1m PAYMENT FROM NOVO NORDISK
* MICHAEL QUINN REDUCES, DILUTED 6% IN QRX
* ACORN CAPITAL REDUCES 1% IN PHARMAXIS
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VIRAX HOLDINGS
Virax climbed 34.8 percent to 15.5 cents on news that Novartis had a $1 billion option with Virax licencee Transgene for the non-small-cell-lung cancer drug TG4010.
Virax has licenced its Co-X-Gene technology to Transgene SA of Strasbourg, France for use in Transgene’s TG4010 as well as TG4001 for pathologies relating to human papilloma virus infection that can lead to cervical cancer.
Last night Transgene announced it had an exclusive option agreement with Novartis for TG4010, in which Novartis would pay a non-refundable fee of $US10 million, with up to EUR700 million ($A1.04 billion) for developmental milestones and sales royalties.
Virax said TG4010 had completed phase IIb testing for the first-line treatment of advanced non-small cell lung cancer in combination with chemotherapy and had potential applications in prostate, breast, kidney, pancreatic and colorectal cancers.
Virax said it would benefit from all milestone and royalty payments upon Transgene achieving relevant development milestones and sale of product.
Virax chief executive officer Dr Larry Ward told Biotech Daily that due to confidentiality agreements with Transgene he could not quantify the value of the Novartis deal to his company, but said “we benefit when they benefit”.
Dr Ward confirmed there would be a payment due to Virax following the $US10 million ($A11 million) upfront fee.
“It will certainly extend our runway,” Dr Ward said.
“On payment by Transgene we will make an announcement to the ASX,” Dr Ward said.
“The exciting thing is the validation of our co-expression technology and therapeutic vaccination,” he said.
Dr Ward said that Roche and now Novartis had shown interested in the technology.
In a media release to the ASX Dr Ward said the Novartis agreement with Transgene was “in addition to the previously announced partnership between Roche and Transgene for the HPV therapeutic vaccine, TG4001” (BD: Apr 12, 2007).
“The advancement of both Transgene products into late stage development exemplifies the intrinsic value of the Co-X-Gene technology intellectual property and the Transgene sub-licence,” Dr Ward said.
Transgene said it would fund and retain control over the next phase of TG4010 development - a pivotal, phase IIb/III clinical trial of about 1,000 patients with MUC1-positive non-small cell lung cancer, who had normal levels of activated natural killer cells at the time of trial entry, expected to begin this year, with final results in 2013.
Transgene said that results from the phase IIb portion of the trial were expected in the first quarter of 2012 and Novartis would have 90 days to exercise its option.
If Novartis exercised the option it would assume all development, regulatory and commercialization costs related to TG4010 across all indications, Transgene said, including a non-refundable licence fee, milestone payments on development for various indications and longer-term commercialization targets, as well as royalties on global sales.
The company said TG4010 (MVA-MUC1-IL2) used the modified vaccinia Ankara (MVA) virus vector, a poxvirus that combines distinguishing advantages for an optimized systemic vaccination and had been “tested extensively in humans as a smallpox vaccine and is known to strongly stimulate innate and adaptive immune responses to antigens”.
MUC1 is a major tumor-associated antigen that provides a viable target for immunotherapy. TG4010 expresses the entire MUC1 gene sequence and has the potential to generate an immune response to all antigenic epitopes of MUC1.
The sequence coding for the cytokine Interleukin 2 (IL2) is included to help stimulate specific T-cell response, Transgene said.
Virax closed unchanged at 11.5 cents with 18.7 million shares traded.
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