Global collaboration to develop new anti-obesity compounds

Healthcare products company AstraZeneca (sales: $23.95 billion) and biopharmaceutical research firm Palatin Technologies, Inc Technologies (AMEX: PTN) have announced an exclusive global licensing and research collaboration agreement to discover, develop and commercialise small molecule compounds that target melanocortin receptors.

The collaboration is based on Palatin's melanocortin receptor obesity programme and includes access to compound libraries, core technologies and expertise in melanocortin receptor drug discovery and development. A near-term objective of the collaboration is to finalise selection of a lead drug candidate for clinical evaluation.

Data accumulated from genetic, pharmacological and physiological studies identify the central melanocortin system as a key regulator of energy homeostasis. This offers significant potential for the development of novel treatments for obesity, diabetes and metabolic syndrome.

Under the terms of the agreement, Palatin will receive an upfront payment of $10 million from AstraZeneca and is eligible for milestone payments totalling $300 million, with up to $180 million contingent upon development and regulatory milestones and the balance on achievement of sales targets, together with the payment of stepped royalties on product sales to double digit rates, dependent on sales achieved.

AstraZeneca will be responsible for product commercialisation, discovery and development costs, with both companies contributing scientific expertise in the research collaboration.

Jan Lundberg, executive vice president, discovery, AstraZeneca, said, "This agreement supports our commitment to discovering and developing innovative medicines in the diabetes and obesity areas. Obesity and its related indications are an area of strategic importance and this novel approach afforded by targeting melanocortin receptors has the potential to become one of the leading treatment modalities of obesity.

"The deal is an example of us accessing the best science outside AstraZeneca and also fits in with our recent decision to re-focus on disease research with diabetes/obesity now one of the priority areas."

"Obesity is increasing at an alarming rate and is a primary factor behind the growing prevalence of type-2 diabetes, cardiovascular disease, and certain cancers," said Dr Trevor Hallam, executive vice president, research and development, Palatin. "We have made considerable progress with the pre-clinical development of our melanocortin receptor-based programmes, especially in the obesity area and we are quite excited to take this programme to the next level with a world-class organisation like AstraZeneca."

"This collaboration with AstraZeneca points to the progress we have made with our melanocortin receptor obesity programme and the potential of melanocortin receptors as targets for obesity. It recognises the value Palatin has built and provides the necessary resources to advance the programme. AstraZeneca has a long-standing record of achievement in drug development and commercialisation and their global leadership in relevant therapeutic areas makes them the ideal party to maximise the potential of our obesity programme," stated Carl Spana, Ph.D. Palatin's President & Chief Executive Officer. "This collaboration highlights the potential of our internal research and development capabilities."

According to the American Obesity Association, obesity is the second leading cause of preventable death after smoking and nearly one-third of adults in the United States are obese. Obesity is associated with a number of serious conditions such as heart disease, stroke, cancer, high blood pressure, and diabetes.

The rate of obesity, a chronic disease in which a person's body weight is seriously greater than is considered healthy, has substantially increased over the past decade, impacting millions of people worldwide, and is expected to continue to grow. Today, over 1.1 billion adults and over 150 million children worldwide are overweight, with over 300 million adults categorised as obese.

Palatin Technologies Inc. is focused on discovering and developing targeted, receptor-specific small molecule and peptide therapeutics. The company's lead product candidate, bremelanotide, is currently in phase II clinical trials for both male and female sexual dysfunction.