GlaxoSmithKline politely dumps $230M Fabry drug deal with Amicus

Slightly less than a year after GlaxoSmithKline ($GSK) and Amicus Therapeutics reported that the first step in their Phase III program for the Fabry disease drug Amigal--or migalastat HCI--had ended in failure, the pharma giant has bowed out of its development collaboration. GSK is handing over a check for $3 million to Amicus ($FOLD) for a small equity stake and giving up its codevelopment and commercialization rights in exchange for a royalty on any future sales of the drug, if it eventually gains approval. And the biotech simultaneously announced a deal to acquire a preclinical program while cutting its staff as it drummed extra cash and debt financing.

Shares of Amicus were hammered last December on the Phase III news and have never recovered, closing today at $2.12, down 53% over the past year. GSK R&D chief Moncef Slaoui politely complimented Amicus on the way out, saying that the company was "well positioned to maintain momentum of the programs." GlaxoSmithKline will continue to be the biotech's biggest shareholder.

Amicus CEO John Crowley, meanwhile, touted the departure of the pharma partner as a big plus for the company, which now has global rights to Amigal. "We look forward to advancing these programs to major milestones into 2014."

GlaxoSmithKline first bought into Amicus three years ago, providing $60 million in upfront and equity payments while promising up to $170 million in milestones and bankrolling part of the development costs for Amigal. At the time, Crowley called the deal a "transformational event" for the company.

Today, Crowley was also heralding a "late" preclinical deal, buying Callidus Biopharma for $15 million in stock and a promise of $115 million in development milestones, acquiring an enzyme replacement therapy for Pompe disease.  

In a restructuring, the company is lopping 13 staffers off of the payroll and closing its San Diego research facility as it circles the wagons in Cranbury, NJ. CSO David Lockhart is on his way out in the reorganization as Callidus founder Hung Do becomes senior vice president, discovery biology. Meanwhile, Amicus has raised $15 million in a private placement and adds that it's getting close to raising $25 million in debt financing. Though the debt financing is not in hand yet, once it hits the bank account the biotech says it will have enough cash to operate "into late 2015."

- here's the release on the Callidus buyout and restructuring

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