DRL arm ties up with US firm Curis, picks up 19.9 pc stake

Aurigene, the biotechnology arm of Dr Reddy's Laboratories, today announced a drug development and commercialisation pact with Curis Inc to treat cancer that could fetch the Indian firm over USD 250 million in payments, while also picking up 19.9 per cent stake in the US firm.
The exclusive collaboration agreement will be focussed on immuno-oncology and selected precision oncology targets, the two companies said in a joint statement.
As per the agreement, Aurigene will be responsible for conducting all discovery and preclinical activities, while Curis will be responsible for all clinical development, regulatory and commercialisation efforts worldwide, excluding India and Russia.

"The collaboration provides for inclusion of multiple programmes and Curis retains the option to license compounds once a development candidate is nominated within each respective programme," it added.
The partners have already identified four programmes. For the first two programmes, Curis has agreed to make payments of up to USD 52.5 million per programme, including USD 42.5 million for approval and commercial milestones, plus pre-specified approval milestone payments for additional indications, if any, to Aurigene.
"Curis expects to exercise its option to obtain exclusive licenses to both programs and file IND applications for a development candidate from each in 2015," DRL said.

For the third and fourth programmes, Curis will pay up to USD 50 million per programme, including USD 42.5 million for approval and commercial milestones, plus pre-specified approval milestone payments for additional indications, if any.

The companies further said for any programme thereafter Curis will pay up to USD 140.5 million per programme, including USD 87.5 million for the other issues, if any.
As part of the agreement, Curis has also agreed to issue to Aurigene approximately 17.1 million shares of its common stock, or 19.9 per cent of its outstanding common stock immediately prior to the transaction, in partial consideration for the rights granted to Curis.

The shares to be issued to Aurigene will be subject to a lock-up agreement until January 18, 2017 with a portion of the shares being released from such lock-up in equal instalments between now and the end of the period.
Commenting on the development, Aurigene CEO CSN Murthy said: "This unique collaboration is an opportunity for Aurigene to participate in advancing our discoveries into clinical development and beyond and mutually align interests as provided for in our agreement.