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news.US-based Edison Pharmaceuticals has entered into agreement with Japanese pharmaceutical firm Dainippon Sumitomo Pharma (DSP) worth $4.295bn for the development of new drugs targeting cellular energy metabolism.
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Under the deal, DSP will get select development and commercialization rights in Japan and North America to jointly discovered drugs in exchange for $10m upfront and $40m payment in R&D support.
DSP will be responsible for providing complete funds for the development of ten new jointly discovered drugs through IND filing and broaden its rights to EPI-589, currently in Phase IB, to include North America.
In exchange, Edison will be eligible to receive in total between $30m and $105m per indication related with successful development of EPI-589 in North America; between $10m and $30m per indication in development milestones associated with development of jointly discovered compounds in Japan and North America.
Edison will also receive about $3.86bn in commercial milestone payments for jointly discovered compounds and EPI-589 in total; and double-digit royalties on commercial sales.
The preferred stock purchase agreement will see DSP invest $50m in Edison and, following request of Edison, additional preferred stocks worth about $50m will be purchased during the period between the first and the fifth anniversaries of the initial equity closing.
Under the license deal signed by the two firms in March 2013, DSP will gain access to three jointly discovered compounds and fully fund their development in Japan and North America, while Edison will retain rights to these compounds outside of Japan and North America.
Edison will also have worldwide rights to up to seven jointly discovered compounds, which will be funded by DSP through IND filing.
Furthermore, DSP will broaden its rights to EPI-589 to include North America, while Edison will retain 100% ownership of its drug EPI-743, and will also continue to direct all research, clinical development, and commercial development outside of Japan.
The R&D program is directed at the characterization of the redox control energy system critical to the generation and regulation of cellular energy metabolism.
The two companies will work together under a novel collaborative framework to discover, characterize, and translate drugs into clinical development.
DSP member of Board of Directors and chief scientific officer Hiroshi Noguchi said the broadening of the company’s partnership with Edison reflects the success it has had to date in its current collaborative development program.
"Compelling data suggest that the mitochondria and redox regulation play a central role in a variety of disease mechanisms," Noguchi said.
"As Edison is a leader in redox drug development, we see the highly integrated alliance structure as a way to bring our companies closer together in order to leverage our mutual strengths, make new and important discoveries, and bring valuable new drugs to the marketplace for critical diseases with unmet medical need."
The company said that Redox biochemical and enzyme-catalyzed reactions underlie the vast majority of the chemistry responsible for the generation of energy within the cellular powerhouse, the mitochondrion.
The initial clinical focus of Edison is on a set of pediatric diseases where there are unambiguous genetic alterations in mitochondrial proteins responsible for energy generation and regulation.
Edison received financial advisory services on the transaction from J.P. Morgan Securities and Barclays, and legal counsel from Morrison & Foerster.