Oslo, Norway, 3 September 2009 - Algeta ASA, the cancer therapeutics company, announces today that it has entered into a global agreement with Bayer for the development and commercialization of Algeta's first in class alpha-pharmaceutical, Alpharadin, for bone metastases. Alpharadin is currently being evaluated in a global phase III trial in men with hormone-refractory prostate cancer (HRPC) that has spread to the bone.
Potential deal value is $800 million plus tiered double digit royalties
Algeta will receive $61 million cash upfront, followed by development and sales milestones. Algeta retains option for co-promotion and profit-sharing in USA. Algeta and Bayer will jointly develop Alpharadin, with Bayer contributing a substantial majority of the costs of future development
Under the terms of the agreement, Algeta has an option for up to 50% co-promotion with Bayer in the United States under a profit-share arrangement. Bayer will commercialize Alpharadin globally and pay tiered double-digit royalties on net sales in markets where there is no co-promotion.
The Alpharadin deal with Bayer totals up to $800 million to Algeta. This is made up of an upfront payment of $61 million plus further cash payments based upon the achievement of certain development, production and commercialization milestones. Algeta will be responsible for manufacturing and supply of the commercial product.
Bayer will also contribute a substantial majority of the costs of future development of Alpharadin as a treatment for bone metastases resulting from HRPC and from other cancer indications, and will fully fund any additional late-stage trials.
Alpharadin is Algeta's lead cancer therapeutic. It is the first in a new class of alpha-emitting pharmaceuticals ('alpha-pharmaceutical') and is based on radium-223. Alpharadin is in a global phase III clinical trial (ALSYMPCA) designed to confirm its efficacy and safety as a targeted treatment for bone metastases in patients with HRPC. Alpharadin is administered as a simple injection and has a unique mode of action whereby it targets bone metastases specifically and exerts a highly localized effect on tumor cells while minimizing damage to normal surrounding tissues. In phase II studies, Alpharadin demonstrated strong evidence that it can prolong patient survival, improve quality of life and offer a benign safety profile.
Andrew Kay, CEO of Algeta, said, "This agreement is the culmination of an extensive process to establish and deliver the best possible commercialization strategy for Alpharadin. In Bayer we have selected a world-class oncology company with a proven global track record of launching major cancer products. We are very excited about working with the Bayer team to deliver this novel and potentially first choice treatment for cancer patients with bone metastases."
Kemal Malik, Head of Global Development and member of the Bayer HealthCare Executive Committee said, "We recognize the tremendous potential of Algeta's Alpharadin as a possible treatment for bone metastases in cancer patients - a serious, life-threatening condition. The data we have seen suggest that Alpharadin represents a highly targeted treatment option with convenient handling and manageable side effects. Bayer is committed to its global oncology franchise and has made significant progress in building a comprehensive pipeline of promising compounds that may provide innovative therapies to cancer patients in need of treatment."