Per the terms of the agreement, Celgene will acquire Avilafor $350 million in cash, with the potential for as much as $195 million morein milestones based on the development and regulatory of AVL-292, Avila's mostadvanced product candidate, as well as up to $380 million in potentialmilestone payments based on the development and regulatory approval ofcandidates generated from the Avilomics platform. The transaction has beenapproved by the board of directors of both Celgene and Avila, and is expectedto close during the first quarter of 2012.
"Avila Therapeutics is a remarkable company that is alignedwith our commitment to improve the lives of patients worldwide throughinnovative science and disease-altering therapies," Dr. Tom Daniel, presidentof research and early development at Celgene, said in a press release. "Inparticular, we see Avila's unique approach to protein silencing as an area ofgreat promise for our research initiatives in hematology, oncology andimmune-inflammatory diseases."
Avila specializes in targeted covalent drugs, and inaddition to sharing cancer as a therapeutic area of focus with Celgene, Avilaalso focuses on viral infection and autoimmune diseases. The company's pipelineis based on its proprietary Avilomics platform. Targeted covalent drugs aresmall-molecule medicines that can silence disease-causing proteins. The drugsform durable bonds with the targeted proteins, shutting down activitythroughout the life of the protein. As a result, targeted covalent drugs offerselectivity and efficacy against mutations, and also represent the possibilityof a decrease in side effects. On its website, Avila notes that there arecurrently more than 38 covalent drugs that have gained U.S. Food and DrugAdministration approval in the fields of oncology, inflammatory, centralnervous system, anti-infectives and vascular and gastrointestinal disorders.
AVL-292, a highly selective Bruton's tyrosine kinase (Btk)inhibitor and Avila's lead candidate, is currently in Phase I clinical testingas a treatment for lymphoma and autoimmune diseases. Btk plays a significantrole in the development and activation of B cells, and inhibition of Btkrepresents a promising approach for treating B-cell driven diseases, includinghematologic cancers such as B-cell chronic lymphocytic leukemia andnon-Hodgkin's lymphoma, and autoimmune diseases such as rheumatoid arthritis.The drug candidate bonds to Btk to silence its activity, and preclinicalstudies proved AVL-292 to be effective in animal disease models. In addition,Avila has also developed a companion covalent probe technology that is capableof determining how much of the target protein was bonded by the drug.
The acquisition is a good fit for Celgene in terms of focuscompatibility. As Celgene already has experience in the field of hematologiccancers, including seven hematology compounds in various stages of clinicaldevelopment in its pipeline, the acquisition of Avila supplements its footholdwithin that therapeutic area. In addition, Avila's approach expands uponCelgene's own current drug discovery methods, as Celgene works on therapiesthat operate through gene and protein regulation.
"Celgene and Avila are uniquely matched, both strategicallyand scientifically," Katrine Bosley, Avila's CEO, said in a press release."Celgene's global leadership in hematology and emerging franchise inimmune-inflammatory diseases will accelerate and expand the clinicaldevelopment of our Btk inhibitor program. Equally important, we value the highstandards of creativity and rigor of Celgene's scientists. We believe workingtogether may accelerate the advancement of more innovative medicines from theAvilomics platform."
The transaction is subject to customary closing conditions,including the expiration of the waiting period under the Hart-Scott-RodinoAntitrust act. Celgene expects that the acquisition will be neutral to 2012non-GAAP diluted earnings guidance.