AMGEN SHOWS NERVE; COMPANY TO PAY UP TO $465 MILLION FOR RIGHTS TO MOLECULES.Byline: Ben Sullivan / Daily News Staff Writer In potentially the biggest biotechnology licensing agreement ever, Thousand Oaks-based Amgen Inc. announced Thursday that it will pay a Baltimore company up to $465 million for the rights to a family of molecules designed to repair nerve damage. Under terms of the agreement, Amgen will invest as much as $60 million in Guilford Pharmaceutical and pay $13.5 million over three years to support research on drugs to be derived from the molecules. Guilford also could receive up to $392 million in so-called ``milestone'' payments if drugs for each of 10 specified diseases are developed and approved. ``If they all work out, it'll be an enormous price tag,'' said Montgomery Securities analyst David Crossen. ``But, ironically, if they all work out, it'll also be an incredible bargain'' for Amgen. Amgen will pay Guilford $15 million in cash up front. It also will buy $15 million in Guilford stock and buy 700,000 warrants for $5 million. If the warrants are exercised, it would mean an additional investment of nearly $25 million. In exchange, Amgen will receive worldwide rights to Guilford's class of molecules that researchers hope will be effective in treating neurodegenerative disorders neurodegenerative disorder Neurology A chronic progressive neuropathy characterized by selective and generally symmetrical loss of neurons in motor, sensory, or cognitive systems Types by area Cerebral cortex–Alzheimer's disease, Pick's disease, Lewy body . The molecules are orally active, meaning they can be taken in pill form, as opposed to via injection, potentially broadening their applications and marketability. The Amgen agreement anticipates development of drugs for Parkinson's disease Parkinson's disease or Parkinsonism, degenerative brain disorder first described by the English surgeon James Parkinson in 1817. When there is no known cause, the disease usually appears after age 40 and is referred to as Parkinson's disease. , Alzheimer's disease Alzheimer's disease (ăls`hī'mərz, ôls–), degenerative disease of nerve cells in the cerebral cortex that leads to atrophy of the brain and senile dementia. , stroke, traumatic brain injuries Traumatic brain injury (TBI), traumatic injuries to the brain, also called intracranial injury, or simply head injury, occurs when a sudden trauma causes brain damage. TBI can result from a closed head injury or a penetrating head injury and is one of two subsets of acquired brain , traumatic spinal cord injuries Spinal Cord Injury Definition Spinal cord injury is damage to the spinal cord that causes loss of sensation and motor control. Description Approximately 10,000 new spinal cord injuries (SCIs) occur each year in the United States. and multiple sclerosis. While combined the diseases represent a potentially huge market, it is uncertain whether all or any of the anticipated drugs will come to fruition, said Charles Engelberg, an analyst at AmeriCal Securities in San Francisco San Francisco (săn frănsĭs`kō), city (1990 pop. 723,959), coextensive with San Francisco co., W Calif., on the tip of a peninsula between the Pacific Ocean and San Francisco Bay, which are connected by the strait known as the Golden . And because Amgen has been developing its own nerve growth factors nerve growth factor n. Abbr. NGF A protein that stimulates the growth of sympathetic and sensory nerve cells. Nerve growth factor , Engelberg said, the Guilford deal may signal that Amgen is uncertain about the prospects of its in-house products. ``At the very least they're hedging their bets,'' Engelberg said. ``Or from the most cynical interpretation, they've looked at what they've got and it's not much.'' Amgen spokesman David Kaye David V. Hope (born 14 October 1964), known professionaly as David Kaye, is a Canadian actor who is better known and revered for his work as a voice actor. Career denied the company is disappointed with its own neurological neurological, neurologic pertaining to or emanating from the nervous system or from neurology. neurological assessment evaluation of the health status of a patient with a nervous system disorder or dysfunction. products. ``The Guilford thing is a long-term supplement to our pipeline,'' Kaye said. ``Though we certainly hope in the years ahead they will be providing us with important, big products.'' Analysts said the deal is intriguing but does not justify a return to the high-$50s that Amgen shares were trading at before a massive sell-off last week. Amgen closed at $52.56 Thursday, up 18.75 cents. ``I'm not entirely reassured,'' Crossen said. ``I think we've established another level for the stock that makes more sense now.'' Amgen shares fell 12 percent last week amid fears that new Medicare rules will hurt sales. Company officials hoped Thursday's announcement would reassure investors about the firm's long-term prospects. CAPTION(S): Chart CHART: FLUCTUATIONS Shares of Thousand Oaks-based Amgen have fallen on recent news of lower sales and a marketing deal. Low: 48 9/16 Thursday's Close: 52 1/2 SOURCE: Bloomberg News |
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