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Durham, Atlanta companies partner: Drug venture could top $200 million
(News & Observer, The (Raleigh, NC) (KRT) Via Acquire Media NewsEdge) Jul. 2--The search for medicines that counter the effects of the stress hormone adrenaline has led a tiny Durham startup to a deal that could be worth more than $200 million.
Addrenex Pharmaceuticals, which employs four full-time workers, announced Tuesday that it signed an agreement to develop several new drugs, including treatments for hypertension and menopausal hot flashes.
It's Addrenex's second development deal with Sciele Pharma, a specialty drug company based in Atlanta, and offers Addrenex up to $27 million in milestone payments.
Sciele also will pay development costs and royalties for medicines that come to market, payments that eventually could top $200 million, said Moise Khayrallah, Addrenex's chief executive.
"I'm elated," Khayrallah said. "We get to learn about these new drugs and have the financial resources to build the company."
Under the agreement, Sciele and Addrenex will work side by side. Sciele spokesman Joseph Schepers said it was premature to put a potential total on the value of the deal.
Addrenex's payoff would suffer if any of the drugs the partners pursue fail in clinical testing, run into regulatory hurdles or generate disappointing sales.
Still, the deal is a big boost for a company that was founded two years ago to give an old drug called clonidine a new life. Such agreements with larger pharmaceutical partners are increasingly common ways that small drug-development companies in the Triangle find funding for further research.
Clonidine is a chemical that controls overproduction of the stress hormone adrenaline and has been an approved blood pressure medication for decades. Doctors have also used the drug for purposes for which it has not been approved -- a practice known as off-label prescribing -- such as easing hot flashes during menopause and helping patients to quit smoking.
Sciele was impressed by Addrenex's research and last year signed an agreement to develop two versions of clonidine: treatments for hypertension and attention deficit hyperactivity disorder that could become available in the next two years. That deal potentially is worth more than $17 million.
Also part of the first agreement was a clause that Sciele would get first peek at novel drugs Addrenex might add to its development pipeline.
In the second agreement, Sciele secured the rights to develop and market ADX415, which also regulates adrenaline. Sciele's interest in ADX415 is "tangible proof that our compounds are valuable and that they fill a critical gap in the treatment of debilitating conditions," Khayrallah said.
Sciele has six or seven such deals with companies large and small, said Angela Larson, a Susquehanna Financial Group analyst who tracks Sciele's stock.
Most of the deals involve new uses for older drugs, Larson said. ADX415 is the first deal Sciele has struck to develop a new technology.
sabine.vollmer@newsobserver.com or (919) 829-8992
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