Novartis strikes $507 million deal with HGS for hepatitis C drug

Under the agreement, Human Genome Sciences (HGS) and Novartis will co-commercialize Albuferon in the US, and will share costs and profits equally. Outside of the US, Novartis will be solely responsible for commercialization of the drug, and will pay HGS a royalty on sales. The companies will share equally in clinical development costs.

HGS will receive an upfront fee of $45 million, and may receive as much as $507.5 million in clinical development, commercial milestone and other payments, including a $47.5 million payment when the first patient is dosed in a phase III clinical trial. HGS said that it expects to initiate phase III clinical development of Albuferon by the end of 2006.

“This agreement brings the strengths of a global leader in the pharmaceutical industry to the development and commercialization of Albuferon, a product that could become the best-in-class immunomodulator in treatment regimens for chronic hepatitis C,” said H Thomas Watkins, president and CEO of HGS.

Clinical studies to date indicate that Albuferon could offer improved dosing in the treatment of chronic hepatitis C, with efficacy and safety at least comparable to the current standard of care, pegylated interferons. These results demonstrate that Albuferon is well tolerated, remains in the blood substantially longer than is reported for recombinant interferon alpha and pegylated interferon alpha, and exhibits robust antiviral activity.