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news.GlaxoSmithKline and biopharmaceutical company Tolerx have entered agreed to develop and commercialize otelixizumab, a monoclonal antibody that has potential across a broad range of autoimmune and immune-mediated inflammatory diseases, including type 1 diabetes.
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Otelixizumab has been evaluated in type 1 diabetes in two Phase II studies and in psoriasis in two Phase I studies.
Under the terms of the agreement, Tolerx will have responsibility for the Phase III clinical program for type 1 diabetes in the US up to and including regulatory submission of the biologics license application. Tolerx has the option to co-promote otelixizumab in type 1 diabetes in the US with GlaxoSmithKline (GSK), while GSK will have exclusive rights to develop and commercialize otelixizumab in all other indications in the rest of the world. GSK also has the exclusive right to develop the pediatric indication for type 1 diabetes in the US.
Tolerx will receive an upfront payment, equity and advance R&D funding totaling $70 million. In addition, Tolerx may receive up to $155 million in future development costs of otelixizumab in type 1 diabetes. Tolerx may earn up to $350 million in milestone payments, assuming successful development and approvals of otelixizumab for type 1 diabetes and multiple additional indications. Tolerx may also receive up to $175 million in sales milestone payments based on tiered net sales thresholds of otelixizumab.
Tolerx will be entitled to receive tiered, double-digit royalty payments on worldwide sales of otelixizumab in all indications. At the time of an initial public offering of Tolerx’s common stock and at the request of Tolerx and certain other conditions, GSK will invest up to an additional $10 million in Tolerx’s common stock.