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Cephalon Signs Option Agreement to Acquire BioAssets Development Corporation

Mon, 10/26/2009 - 5:26am
Cephalon, Inc. and BioAssets Development Corporation, aprivately held biopharmaceutical company, today announced that the companieshave signed an agreement that will provide Cephalon with an option to acquireBDC. Under the terms of the option agreement, Cephalon will pay BDC anupfront payment of $30 million and, assuming exercise of the option, anadditional payment on the closing of the acquisition. BDC stockholders couldalso receive additional future payments related to regulatory and salesmilestones. The option agreement is subject to customary closing conditionsincluding the receipt of necessary BDC stockholder approvals. BDC is currently conducting a Phase two placebo-controlled proof ofconcept study with the tumor necrosis factor (TNF) inhibitor, etanercept,epidurally administered to a minimum of 40 patients with sciatica. Sciaticais a neuropathic inflammatory pain condition that occurs when the sciaticnerve is compressed, injured or irritated. BDC has secured an intellectualproperty estate around use of TNF inhibitors for sciatic pain in patients withintervertebral disk herniation, as well as other spinal disorders. "BioAssets offers an estate of intellectual property and scientificexpertise that will allow us to evaluate our own domain antibody tumornecrosis factor inhibitor, CEP-37247 (formerly known as ART-621), for thetreatment of sciatica," said Frank Baldino, Jr., Ph.D. chairman and CEO ofCephalon. "Combining these two innovations helps fulfill our strategy toaddress unmet patient needs, while focusing on specialty physicians.""Development of an improved non-surgical therapy for sciatica presents apressing unmet medical need and a potentially significant commercialopportunity," commented James Gorman, M.D., Ph.D., CEO of BioAssets. "Cephalon combines an innovative TNF inhibitor pipeline with a wellestablished pain therapeutic franchise. I believe these capabilities uniquelyposition Cephalon to develop and commercialize a novel biologic therapy forthese patients." Cephalon may exercise its option at any time from the closing date of theoption agreement until the date that is 60 days after receipt of one-monthpatient response data from the Phase two proof of concept study. Data areanticipated to be available in the second half of 2010.
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