Teva Enters Into Agreement With OncoGenex

Teva Pharmaceutical (Teva) and OncoGenex Pharmaceuticals (OncoGenex) have entered into a global license and collaboration agreement to develop and commercialise OGX-011, as well as an agreement to purchase shares in OncoGenex.

OGX-011 is a phase III cancer therapy designed to inhibit cancer treatment resistance. OGX-011 is expected to be used as adjunct therapy to enhance the effectiveness of chemotherapy and has shown positive results when added to currently available chemotherapies in several tumor types.

Teva and OncoGenex will collaborate on a global phase III clinical program, with two phase III clinical trials expected to be initiated in 2010, a phase III Study for Second-line Chemotherapy in Men with Metastatic Castrate Resistant Prostate Cancer (CRPC) and a phase III Study in First-Line Chemotherapy for Metastatic CRPC.

An additional phase III Study in First-Line Treatment of Advanced, Unresectable Non-Small Cell Lung Cancer (NSCLC) is likely to be initiated by early 2011.

As per the terms of the collaboration and share purchase agreements, Teva will provide OncoGenex with a $60m initial cash payment, which includes a $10m equity investment in OncoGenex common stock at a price of $37.38 per share, upfront payment of $20m and pre-payment of $30m for OncoGenex’s contribution to the development costs of OGX-011.

Reportedly, OncoGenex will be eligible to receive up to $370m in additional cash payments upon achievement of various milestones, including regulatory milestones and sales targets.

In addition, OncoGenex will receive tiered royalties on sales of the product with the royalty percentage ranging from the mid-teens to the mid-twenties, depending upon the amount of net sales. Teva is responsible for all commercialization and development expenses. OncoGenex retains an option to co-promote OGX-011 in the US and Canada.

Scott Cormack, president and CEO of OncoGenex, said: “Together with Teva, we have forged a strong path moving forward for the development of OGX-011 that commits significant cash investment to a broadened Phase III clinical development plan that includes first- and second-line castrate resistant prostate cancer as well as non-small cell lung cancer.

“The agreement provides us with capital resources for the development of OGX-011 through completion of the Phase III clinical trials and into product commercialisation. We’re creating a solid foundation to maximise the broad potential of OGX-011 and bring this important treatment option to cancer patients.”