'Smoker's lung' drug wins firms multi-million pound deal
An inhaler treatment for “smoker’s lung” was today at the centre of one of the biggest-ever deals in the UK biotech sector.
British firms Vectura and Arakis have agreed to let Swiss drug maker Novartis develop and commercialise its AD237 treatment in a deal that could be worth $375m (£198.2m / €291.6m)).
The drug is being developed as a once-daily treatment that acts quickly to open up the patients’ airways and is currently in phase II clinical trials.
Drugs have to pass three phases of clinical trials before an application can be submitted to regulators for approval.
Shares in Vectura, which is based at Chippenham in Wiltshire, England, leapt 7% on the news to reach their highest level since the group floated on the stock market last summer. Arakis is based at Little Chesterford, near Cambridge, and employs 38 staff.
Smoker’s lung – known medically as chronic obstructive pulmonary disease (COPD) – is believed to be the fourth-largest cause of death in the world.
It is estimated that 4% of the populations of the US, Europe and Japan suffer from the disease and that it affects one in 15 smokers.
Symptoms include chronic bronchitis and emphysema or both conditions, which slowly progress and eventually lead to a largely irreversible loss of the use of the lung.
The current market for treatments of COPD is estimated to be worth $4bn (£2.11bn / €3.1bn) and this will grow to $10bn (£5.29bn / €7.8bn) by 2010, when it is expected that AD237 will be launched.
Dr Chris Blackwell, chief executive of Vectura, said: “We believe that AD237 will play a major role in the expansion of the COPD market which is under-served today but set for dramatic growth over the coming decade.”
Under the terms of the deal, Vectura and Arakis will each receive $15m (£7.9m / €11.7m) upfront and both could receive further payments of up to $172.5m (£91.2m / €134.1m) if the drug hits clinical, regulatory and commercialisation targets.
In addition, royalties on sales of the drugs will be paid by Novartis to the biotech firms.
Last year, Vectura announced that trials of the drug on 45 patients suffering from smoker’s lung were successful. It intends to make a global filing with regulators in 2009.
