Epix, Glaxo in Development Deal
Epix
(EPIX)
surged 45% early Tuesday on news of a big drug development linkup.
GlaxoSmithKline
(GSK)
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agreed to buy 3 million shares of Epix as the drug companies set a collaboration to work on drugs using so-called G-protein coupled receptors.
Lexington, Mass.-based Epix said it will get upfront payments of $35 million, including proceeds from the stock sale, and will be eligible for milestone payments of up to $1.2 billion. Epix will also receive tiered double-digit royalties on sales by GSK of all collaboration-developed product sales.
The collaboration with London-based Glaxo covers the treatment of Alzheimer's and other diseases. The deal includes Epix's novel 5-HT4 partial agonist program, PRX-03140, in early-stage clinical development for the treatment of Alzheimer's.
Epix said it expects to end 2006 with more than $100 million in cash and marketable securities. It expects to have cash sufficient to fund operations through 2008.
Epix surged $2.52 to $8.03.
