Tekmira Pharmaceuticals Corporation, a developer of RNA interference (RNAi) therapeutics, announced today that it has signed an option agreement with Monsanto, pursuant to which Monsanto may obtain a license to use Tekmira’s delivery technology. Tekmira noted that the potential value of the transaction could reach up to $86.2 million following the successful completion of milestones. Tekmira expects to receive a near-term payment of net $16.5 million.
Development of RNAi therapeutic products is limited, in part, by the inability of RNA molecules to access target cells and gain entry into the cell cytoplasm, where they carry out their action. According to Tekmira, its delivery technology has been shown to overcome these limitations, enabling efficient delivery of RNAi to target cells, facilitating cellular uptake and release into the cytoplasm, and allowing efficient and selective “silencing” or reduction of certain target proteins.
The agreement announced today follows Monsanto’s initial testing of Tekmira's delivery technology and the demonstration of initial positive results from use of that technology in the field of agriculture. The companies’ agreement and research collaboration will now focus on the development of biological solutions for farmers, particularly solutions meant to provide sustainable pest, virus, and weed control.
Over the option period, which is expected to be approximately four years, Tekmira will provide lipid formulations to Monsanto’s research and development activities, and Monsanto will make certain payments to Tekmira to maintain its option rights. At any time during the option period, Monsanto may choose to exercise its option, in which case Monsanto will pay to Tekmira an option exercise fee and will receive a worldwide, exclusive right to use Tekmira’s delivery technology in the field of agriculture.
Monsanto may elect to terminate this option at their discretion. Tekmira retains all rights to therapeutics uses of all current IP and IP developed under the agreement. “This new agreement points to the broad applicability of Tekmira’s delivery platform, and underscores the promise of applying this science within the field of agriculture,” said Mark J. Murray, Ph.D., Tekmira’s president and CEO.
“We believe that by collaborating with Tekmira, the company’s research can provide a key enablement to support and expand our BioDirect technology platform," said Robert M. McCarroll, Ph.D., vice president of chemistry technology for Monsanto.