Zeljko Covic, chief executive officer of Pliva, said that the divestment of its Research Institute would allow the company to focus its efforts on the generics part of its business.
Under the terms of the agreement, Pliva will receive an upfront payment of $35m and, conditional on the entry of certain early stage projects into clinical development, contingent payments totaling up to $15m.
In addition, Pliva will receive contingent royalty-based consideration pending commercialization of certain assets. GSK will take on all 130 employees of the Pliva Research Institute and will gain full ownership of the company, including all intellectual property and certain other assets such as an oncology early-stage clinical asset and preclinical compounds emerging from the macrolide research.
The closing of the transaction is expected to occur during April 2006, subject to obtaining necessary regulatory approvals.
“This Centre of Excellence will strongly complement and enhance our specific expertise and commitment to the discovery of new chemical entities across several therapeutic areas through application of unique platform technologies,” said Allan Baxter, senior vice president of drug discovery at GSK.