Bayer, Onyx Pharmaceuticals restructure Nexavar partnership

SAN FRANCISCO— Onyx Pharmaceuticals, Inc. and BayerHealthCare announced today the restructuring of their long-term partnership forthe global development and marketing of Nexavar (sorafenib) tablets, and alsoentered into a new agreement related to Bayer's late-stage oncology compound,regorafenib.

Per the terms of the agreement, Bayer will have finaldecision-making authority for regorafenib in terms of global development andcommercialization since Bayer retains ownership of the compound. Bayer will alsocontract the Onyx sales force to promote regorafenib, in addition to Bayer'sown sales force, in the United States. For its part, Onyx stands to receive aroyalty on any future global net sales of regorafenib in oncology.

"These new agreements strengthen the collaboration andprovide Onyx the opportunity to participate significantly in the marketpotential of regorafenib," N. Anthony Coles, M.D., President and ChiefExecutive Officer of Onyx, said in a press release. "Together we aretaking our collaboration to the next level by more effectively structuring ourfuture working relationship. Onyx and Bayer are committed to benefitingpatients worldwide and ensuring that the potential of both Nexavar andregorafenib is fully realized."

Nexavar's status under the two companies' revisedcollaboration agreement will remain unchanged for the most part. Both Bayer andOnyx are free to utilize their respective Nexavar sales forces for thepromotion of regorafenib as well as additional products outside of the collaborationin the future. Bayer will be purchasing Onyx's royalty tights for sales of theproduct in Japan, in exchange for which Onyx will receive a one-time payment.Pending that purchase, Bayer will not have any obligation to pay royalties toOnyx on Japanese sales of Nexavar after Dec. 31 of this year.

In addition,should a change of control or acquisition of Onyx occur, the currentlyestablished profit-sharing, co-development and U.S. co-promotion of Nexavarwill remain the same. the agreements also settle and dismiss the claims relatedto the complaint Onyx filed against Bayer Corporation and Bayer A.G. in theU.S. District Court.

"These agreements set the stage for the next chapter inour successful partnership," Dr. Joerg Reinhardt, Chairman of the BayerHealthCare Executive Committee, noted in a press release. "Innovation iscentral to Bayer's mission 'Science for a Better Life,' and our ongoingcollaboration with Onyx demonstrates the priority we place on working withpartners to identify, develop and commercialize new medicines to meet unmet orunder-served medical needs."

Regorafenib is an oral multikinase inhibitor of angiogenic,stromal and oncogenic receptor tyrosine kinases, and is currently undergoingclinical triasl to determine its potential as a treatment for various types oftumors. Nexavar has been shown to inhibit the tumor cell as well as tumorvasculature, and has been approved in the United States for the treatment ofunresectable liver cancer as well as advanced kidney cancer.

Bayer and Onyxhave been working together on Nexavar for several years in a variety ofindications. It is approved for kidney and liver cancer patients, but has alsobeen tested as a treatment for thyroid cancer, non-small cell lung cancer andbreast cancer. In preclinical studies, it has proven to inhibit members of twoclasses of kinases that are believed to be involved in cell proliferation aswell as angiogenesis. The kinases included consist of Raf kinase, VEGFR-1,VEGFR-2, VEGFR-3, PDGFR-B, KIT, FLT-3 and RET.

SOURCE: Onyx Pharmaceuticals press release