GSK inks potential $1B deal with Concert

GlaxoSmithKline has beefed up its early stage pipeline in a deal with Concert Pharmaceuticals that could be worth up to $1 billion. The two companies will collaborate to develop and commercialize deuterium-containing medicines. Deuterium--a relative of hydrogen that can be isolated from sea water--is an isotope of hydrogen. When deuterium is used to strategically replace hydrogen molecules in therapeutics with deuterium, it forms a stronger chemical bond to a carbon atom of a molecule. This, Concert says, could positively influence efficacy and side effect profiles of drugs.

GSK gets CTP-518, a protease inhibitor for the treatment of HIV expected to enter Phase I clinical trials in the second half of 2009, a preclinical compound for chronic renal disease, and a third research product in Concert's pipeline. Concert will also provide GSK with deuterium-modified versions of three GSK pipeline compounds for GSK to develop. Concert will handle the R&D activities for the programs through pre-specified trials. GSK will take over development after that, handling further development and commercialization of each drug. If GSK takes a pass on any of the drug candidates, Concert will retain full rights to those programs.

Concert will receive $35 million in upfront payments, including a $16.7 million equity investment by GSK. It could also earn milestones and tiered, double-digit royalties based on deuterium-containing products arising from the Concert pipeline programs, as well as royalties on sales.

"We believe Concert's approach to deuterium modification of medicines has broad potential to enhance certain drug properties and result in innovative new medicines," Patrick Vallance, Senior Vice-President Drug Discovery, GSK. FierceBiotech has profiled Concert Pharmaceuticals, and the company was a 2008 Fierce 15 winner. To date, the company has raised $95.5 million in VC.

- here's the release from Concert