Important note: Information in this article was accurate in 1991. The state of the art may have changed since the publication date.
Los Angeles Times (LT) - FRIDAY April 26, 1991; Edition: San Diego County Edition Section: Business Page: 1 Pt. D Col. 5 Word Count: 479
GREG JOHNSON; TIMES STAFF WRITER
In return, Green Cross will hold worldwide marketing rights for the drug, which is expected to begin human clinical trials during 1992, Viagene Vice President Brad Gordon said Thursday.
Viagene, a 4-year-old, privately held company, will retain manufacturing rights and receive royalties for the drug, which company officials believe could help the immune system destroy HIV-infected cells.
The worldwide marketing agreement is unusual, biotechnology industry observers said, because most U.S. companies usually retain marketing rights for their home market. Increasingly, however, major international drug companies "are looking for worldwide rights" when they strike research and development agreements with start-up firms, said Pamela Bridgen, executive director of the Assn. of Biotechnology Cos., a Washington-based trade group.
Viagene's agreement "might be a vision of the future" in the biotechnology industry, Bridgen said. "With the increasing cost of developing a drug and getting it to market . . . companies want to make sure they get their pay-back" through worldwide sales agreements, Bridgen said.
The cash infusion "is a hell of a good deal for Viagene," said Jim McCamant, editor of the San Francisco-based Medical Technology Stock Letter. "For $40 million, you can't argue with them saying 'OK' to worldwide rights."
Green Cross sought U.S. marketing rights for the planned drug because "the largest market for HIV-infected people is, in fact, in the U.S.," Gordon said. "The incidence (of HIV) in Japan is very low." Green Cross also has a "strong presence" in Europe, home to another large HIV-infected population, Gordon said.
Green Cross, which reported $700 million in sales during 1990, has a "strong U.S. presence" through Alpha Therapeutics, a Los Angeles-based subsidiary that manufactures and markets blood products, Gordon said. Viagene's planned HIV drug will dovetail with Alpha Therapeutics' marketing efforts, Gordon said.
Green Cross acquired Alpha Therapeutics, one of the nation's largest producers of blood products, in 1978. The company's products are used to treat hemophilia, immune deficiencies, shock and trauma. Alpha has 1,800 employees in the U.S., including 1,200 at its Los
Angeles plant. Alpha's sales have increased "ten-fold" in recent years to $200 million, Alpha president Ed Matveld said Thursday.
Viagene will receive portions of the $40 million during a four-year period. Distribution will be determined by Viagene's ability to meet "certain milestones" as the product moves through R&D and into production, Gordon said.
The $40 million also includes a $4.7-million equity investment being made by Green Cross. Viagene previously had raised about $13 million during four venture capital rounds.
The company, with 45 employees, was spun off from San Diego-based Gensia Pharmaceuticals, another biotech firm, in 1987. David Hale, Gensia's president, also serves as chairman of Viagene's board.
910426
LT910410
Copyright © 1991 - Los Angeles Times. All rights reserved. Reproduced with permission. Reproduction of this article (other than one copy for personal reference) must be cleared through the Los Angeles Times, Permissions, Times Mirror Square, Los Angeles, CA 90053. http://www.latimes.com.
AEGiS is a 501(c)3, not-for-profit, tax-exempt, educational corporation. AEGiS is made possible through unrestricted funding from Broadway Cares/Equity Fights AIDS, Elton John AIDS Foundation, the National Library of Medicine, Pacific Life Foundation and donations from users like you.
Always watch for outdated information. This article first appeared in 1991. This material is designed to support, not replace, the relationship that exists between you and your doctor.
AEGiS presents published material, reprinted with permission and neither endorses nor opposes any material. All information contained on this website, including information relating to health conditions, products, and treatments, is for informational purposes only. It is often presented in summary or aggregate form. It is not meant to be a substitute for the advice provided by your own physician or other medical professionals. Always discuss treatment options with a doctor who specializes in treating HIV.
Copyright ©1980, 1991. AEGiS. All materials appearing on AEGiS are protected by copyright as a collective work or compilation under U.S. copyright and other laws and are the property of AEGiS, or the party credited as the provider of the content. .