Celgene, Forma Expand Collaboration for Up to $600M, with a Possible Buyout
Celgene and Forma Therapeutics have agreed to a second collaboration with the possibility of two more, all valued at up to $600 million, and an option by Celgene to buy out its partner–– a year to the month that the companies launched their first partnership.
Unlike their first hook-up, which focused on discovering, developing, and commercializing protein homeostasis target-regulating drug candidates, “this second agreement expands across Forma’s preclinical and future clinical development efforts, encompassing numerous protein target families and covering a broad range of therapeutic areas,” Steven Tregay, Ph.D., Forma’s President and CEO, said in a statement.
The companies agreed to evaluate emerging families of targets for new drugs, with Celgene accessing Forma’s drug-discovery platforms and network of academic experts. Celgene has an option to license rights to select current and future Forma programs in exchange for undisclosed additional development and regulatory milestone payments.
Celgene agreed to pay Forma $225 million in upfront cash under their collaboration, set to run 3½ years. In addition, Celgene has the option to enter into up to two additional collaborations with terms of two years each for additional payments totaling approximately $375 million.
Should each collaboration succeed and Celgene opt to enter all three collaborations, they all would extend for a total of at least 7 ½ years. During the third collaboration term, Celgene has the exclusive option to acquire Forma, including the U.S. rights to all licensed programs, and worldwide rights to other wholly owned programs within Forma at that time.
In return, Celgene agreed to oversee all global development activities and costs after completion of Phase I clinical trials. However, Forma retains U.S. rights to all assets licensed through the collaboration, including responsibility for manufacturing and commercialization. Forma will also maintain worldwide rights for products not licensed to Celgene,
The collaboration builds on a relationship launched in April 2013. At the time, Celgene agreed to make up to $200 million in research and early development payments available to Forma, a sum intended to incentivize Forma to advance its full complement of drug candidates through Phase I. Forma and Celgene agreed to carry out initial R&D for four years.
The companies also agreed to enter into a pre-negotiated license agreement for each drug candidate that met undisclosed criteria, then continue their collaboration until all license agreements had expired and all applicable royalty terms covering particular products have expired.
Forma’s drug-discovery programs include high-throughput screening, structural and computational drug design, an expanding archive of compounds, and high-speed parallel synthesis and purification of broad protein families, a platform designed to support to support drug discovery programs and novel screening libraries.
In October, Forma disclosed that it earned its first milestone payment for successfully meeting its first objective under the first collaboration – without disclosing that first objective or the size of the milestone payment.
During its first five years, Forma says it has explored more than 110 targets across its core focus areas of tumor metabolism, epigenetics, protein homeostasis and other essential protein-protein interactions.