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Print Edition StoriesTuesday, June 2, 2009
Concert Pharmaceuticals in potential $1B GSK deal
By Mass High Tech staff
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In a deal that could possibly bring $1 billion to Concert Pharmaceuticals Inc., GlaxoSmithKline (NYSE: GSK) and the Lexington-based biotech report that they will collaborate to develop and commercialize drugs based on the hydrogen isotope deuterium.
Last month, Concert was awarded a patent on a method of separating the deuterium analogs rimonabant and mosapride from seawater. The company uses deuterium to develop new medicines for HIV/AIDS, renal disease and cardiovascular disease.
Under the terms of the deal, GSK will hand Concert $35 million in upfront payments, $16 million of which will be in the form of an equity investment. The deal includes three of Concert’s research and development programs — CTP-518, a protease inhibitor for the treatment of HIV expected to enter Phase I clinical trials in the second half of 2009; a preclinical compound for chronic renal disease; and a third research product in Concert’s pipeline the companies did not identify in the release.
Concert could also get milestone payments and royalties based on deuterium-containing products that come out of its pipeline, as well as milestones and royalties on the sales of deuterium-containing products that GSK might develop. In total, the deal could bring in excess of $1 billion in total milestone and upfront payments to Concert.
Concert will have to do the research and development activities through completion of pre-agreed clinical trials for its compounds, then GSK may elect to obtain an exclusive, worldwide license for product candidates within the program. If GSK does pick up a license, it will take on responsibility for development and commercialization. Concert keeps full rights to product candidates in any program GSK does not license.
Since it was founded in 2006, Concert has raised more than $110 million from venture capitalists and institutional investors including Brookside Capital Partners Fund, TVM Capital, Three Arch Partners, Fidelity Investments, Skyline Ventures, Flagship Ventures, Adage Capital Management, Greylock Partners, New Leaf Venture Partners, QVT Fund, SR One Ltd. (GSK’s health care venture fund), Mediphase Venture Partners, Westfield Capital Management and Alexandria Equities LLC.
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