Clal Biotechnology Industries Ltd. (TASE: CBI) has bought the drug DiaPep277 from German-Israeli biopharmaceutical company DeveloGen (Israel) AG (formerly Peptor) and has founded Andromeda Biotech Ltd. to develop it. DiaPep, a treatment for type 1 diabetes, is now undergoing Phase III clinical trials
Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA), a minority shareholder in CBI has an option to acquire Andromeda for a one-time payment plus royalties.
CBI and DeveloGen did not disclose the details of their agreement, but on the basis of DiaPep277’s stage of development and the size of the diabetes market, CBI will presumably pay DeveloGen tens of millions of dollars over the coming years. If Teva acquires Andromeda, it might pay hundreds of millions of dollars in royalties.
Sources inform ''Globes'' that DeveloGen will sell another molecule, PKB for the treatment of cancer, to a large pharmaceutical company. PKB is still in the early development stage, and is due to begin human clinical trials late this year. DeveloGen is effectively eliminating its activity in Israel, where it employs ten people in Rehovot, most of whom will go to Andromeda.
DeveloGen Israel is the remnant of Peptor, which merged with DeveloGen in 2003, after $63 million was invested in the company by Teva, CBI, Johnson & Johnson (NYSE:JNJ), Citibank Inc. (NYSE:C) and other investors.
Published by Globes [online], Israel business news - www.globes.co.il - on June 14, 2007
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