Teva Pharmaceutical hikes stake in diabetes drug developer Andromeda
14 Jun 2010
Teva Pharmaceutical Industries, the world's largest generic drug maker, has exercised its option to invest an additional $11.9 million in diabetes drug developer Andromeda Biotech Ltd.
Andromeda's parent company, Clal Biotechnology Industries, the largest biotechnology investment group in Israel, will also invest $5.6 million, bringing the total investment in Andromeda to $17.5 million.
Post investment, Petah Tikva Tikva, Israel based Teva's stake in Andromeda will increase to 16 per cent, while Clal's stake will fall from 89 to 84 per cent.
The additional investment will be used by Andromeda to fund the continuation of confirmatory Phase III clinical trial of its leading drug candidate DiaPep277 and to obtain marketing approval for it in Europe and the US.
If Andromeda gets the approval for marketing the drug in Europe, Teva, which had revenues of $13.9 billion in 2009, can exercise an option to invest $44 million, valuing Andromeda at $480 million, and when it gets the US approval, Teva can invest $52 million valuing the company at $555 million.
DiaPep277, which is currently in Phase III clinical trials for treating type 1 diabetes, is a unique peptide representing a novel therapeutic approach to prevent the destruction of insulin producing cells in the pancreas.
To date, there is no therapy that can prevent the destruction of insulin secreting beta cells. DiaPep277 is designed to treat type 1 diabetes patients with residual insulin secreting cells in order to preserve their function.
Potential target populations include newly diagnosed adult patients, type 1 diabetic children, people with a high risk of developing type 1 diabetes, and type 1 diabetes patients with slow progressing disease.