Under the terms of the collaboration agreement between the two companies, which became effective in January 2007, the selection of XL139 by Bristol-Myers Squibb entitles Exelixis to a milestone payment of $20 million. In addition, Exelixis has exercised its option under the collaboration agreement to co-develop and co-commercialize XL139 in the US.
Following the transfer of the XL139 development program, which is expected to occur promptly, Bristol-Myers Squibb will lead all global activities. The parties will co-develop and co-commercialize XL139 in the US and share those profits 50/50. Exelixis will be entitled to receive double-digit royalties on product sales outside of the US.
XL139 is a small molecule inhibitor of the hedgehog pathway that is deregulated in a variety of cancers and the pathway is a promising target for novel cancer therapies.
George Scangos, president and CEO of Exelixis, said: “We expect that Bristol-Myers Squibb’s resources will help speed the development of this novel compound designed to inhibit an important cancer-related pathway. This will enable us to deploy our internal resources on our proprietary assets.”