Friday, November 21, 2008

Infinity alliance with Purdue, Mundipharma reels in $75 million

By Mass High Tech Staff

Cambridge-based Infinity Pharmaceuticals Inc. has formed a research, development and commercialization alliance with Purdue Pharmaceutical Products LP and Mundipharma International Corp. Ltd., in which Infinity may receive up to $75 million in equity investment for its oncology products, Infinity officials announced.

Under terms of the deal, Infinity (Nasdaq: INFI) will continue to control the discovery and development efforts of its oncology drugs. The company will maintain commercialization rights of its oncology products and pay Mundipharma a royalty based on U.S. sales of such products. Likewise, Cambrdige, U.K.-based Mundipharma has rights to commercialize these oncology products outside of the U.S. and must pay a royalty to Infinity on the sales of these products.

Also, through the buying of four million common stock shares, New Jersey-based Purdue made a $45 million equity investment in Infinity. The alliance entails shareholder approval of an additional $30 million more in stock and warrants. Purdue is also offering a $50 million line of credit to Infinity, with the expectation of principal and interest repayment in 10 years.

The alliance focuses on advancing Infinity’s anti-cancer drugs, including IPI-926, an inhibitor of the Hedgehog pathway, currently in Phase 1 clinical studies.

Infinity Pharmaceuticals reported a net loss last quarter of $12.4 million on total revenue of $2.5 million.