Concert Pharmaceuticals has forged a $200 million-plus licensing pact with Avanir to create a deuterium-modified form of its lead therapy, a next-gen treatment for neurological and psychiatric disorders. The Lexington, MA-based biotech is handing over the program to Avanir in the deal, which in turn will pay an unspecified upfront fee along with a string of milestones as it takes the reins on developing the treatment.
"A significant portion of that ($200 million) is pre-commercial," says Concert CEO Roger Tung, with tiered royalties that reach into double digits. Concert was named a Fierce 15 company in 2008.
The deal came about after a brainstorm, says Tung. Avanir's Nuedexta is an approved combo treatment that relies on dextromethorphan and quinidine to treat pseudobulbar affect, or PBA. The quinidine is a metabolic inhibitor that's necessary to allow the dextromethorphan to work properly. Originally Avanir had pushed for a higher dose of quinidine to maximize the therapeutic effect of the active ingredient, but had to significantly reduce that to satisfy FDA regulators' concerns about potential cardiovascular toxicity.
Tung believes that deuterium has the potential to stabilize dextromethorphan to such an extent that quinidine might not be necessary. And in doing so Avanir has the potential to come up with a second-gen product that can reach a wider market of patients. It also made sense to license the CTP-786 compound to Avanir, which has the development expertise in the field, rather than go it alone, adds the CEO. And Avanir may be able to rely on earlier data on the active ingredient to hurry this development project along to a rapid conclusion.
The partnership helps Concert stay in business with close to 50 employees without having to raise more money from investors. GlaxoSmithKline ($GSK) has played a big role in funding the company as well. GSK's milestones have helped finance the company's work to get its lead treatment--CTP-499--into a proof-of-concept study, which has just launched with the dosing of the first patient. That trial should wrap in mid-2013, leaving Concert hopeful it will have the data it needs to land a partner for the program.
- here's the press release
Special Report: Wheeling and dealing at J.P. Morgan 2012 - Concert Pharmaceuticals CEO Roger Tung