NOVATO, Calif.—Biopharmaceutical company BioMarin Pharmaceutical announced Feb. 5 that it has entered into a stock purchase agreement to acquire San Bruno, Calif.-based LEAD Therapeutics, a drug discovery company whose key compound is LT-673, an orally available poly polymerase inhibitor for the treatment of patients with rare, genetically defined cancers.
Such an acquisition is in line with BioMarin's strategic goals and mission, which is to develop and commercialize innovative biopharmaceuticals for serious diseases and medical conditions, focusing on product candidates that: Address currently unmet medical needs; suggest a clear-cut development profile; and provide an opportunity to be first-to-market.
Under the terms of the stock purchase agreement, BioMarin will make an upfront payment of $18 million to the stockholders of LEAD and will pay an additional $11 million upon acceptance of the investigational new drug filing. This filing is expected by the end of 2010, and there is the potential for up to $68 million more for development and launch milestones related to LT-673.
The company also expects between $11 million and $13 million in net operating expenses associated with the LEAD transaction, which includes between $3 million and $4 million in acquisition related charges. Subject to customary closing conditions, the acquisition is expected to be completed by mid-February 2010.
In 2010 guidance for the company BioMarin CEO Jean-Jacques Bienaime noted that "considering the cash upfront and milestone payments associated with the Huxley and LEAD transactions, BioMarin still expects to be slightly cash flow positive in 2010."
In fact, BioMarin projects that cash, cash equivalents and short and long term investments will total approximately $475 million at the end of 2010, assuming no additional business development transactions.
Speaking the acquisition of LEAD and its LT-673 compound, Hank Fuchs, executive vice president and chief medical officer of BioMarin, says, "Polymerase inhibitors have shown impressive survival benefits in cancer patients with tumors that have defects in DNA repair or in combination with DNA damaging agents. There are many opportunities to achieve selective lethality with polymerase inhibitors in both rare and more common cancers. LT-673 has been proven to be highly active in mouse xenograft models of human cancer and appears to have favorable properties, including potency, selectivity, and bioavailability."
BioMarin's product portfolio already has three approved products and multiple investigational product candidates. The FDA-approved products are Kuvan (sapropterin dihydrochloride) tablets for phenylketonuria (PKU), an oral small-molecule therapeutic developed in partnership with Merck Serono; Naglazyme (galsulfase) for mucopolysaccharidosis VI (MPS VI), a product wholly developed and commercialized by BioMarin; and Aldurazyme (laronidase) for mucopolysaccharidosis I (MPS I), a product which BioMarin developed through a 50/50 joint venture with Genzyme Corp.
Investigational product candidates include PEG-PAL for the treatment of PKU, and 6R-BH4, currently in Phase II clinical development for the treatment of peripheral arterial disease.
BioMarin also reported encouraging preliminary data on its BMN 110 product, currently in a Phase I/II trial for the treatment of the lysosomal storage disorder mucopolysaccharidosis type IVA (MPS IVA), or Morquio A Syndrome. BioMarin plans to announce top-line results for the full 36-week study after completion of dosing at 2.0 mg/kg in the second quarter of 2010.
