Deals add antibacterial programs to firm’s antiviral-focused pipeline.

Australian anti-infectives company Biota reported separate agreements to purchase key assets and drug development programs from Prolysis and MaxThera for a total consideration of $11.53 million in cash and shares. The acquisitions add antibacterials projects to Biota’s existing pipeline, which is focused on antivirals. Biota says that it aims to invest slightly over $38 million into further developing the acquired companies’ major drug development projects over the next 3–5 years.

Under terms of the A$10.8 million (about $10.03 million) share-based Prolysis deal, Biota will take over the U.K. company’s existing laboratory facilities and staff in Oxford as well as its multidrug-resistant antibiotic programs. Prolysis shareholders will receive up to a 15% share in all milestone and royalty payments earned by Biota on product commercialization.

Biota expects to invest some A$25 million (roughly $23.22 million) into the Prolysis research projects over the next three years. Prolysis’ pipeline includes a lead gyrase program targeting DNA supercoiling in gram-positive bactieria and a cell-division inhibitor program targeting staphylococcal cell division. The latter project received a £3.48 million (approximately $5.76 million) award from the U.K.’s Wellcome Trust. This funding agreement will also be transferred to Biota.

Boston-based MaxThera, meanwhile, has developed a suite of validated bacterial targets and early-stage antibacterial compounds against serious bacterial infections including multidrug-resistant organisms. Lead programs target inhibitors of a bacterial enzyme in the co-enzyme A biosynthetic pathway.

Biota is paying $1.2 million in cash and another $300,000 in shares that will be released from escrow at six and 12 months postcompletion of the deal. The firm aims to invest up to $15 million in major MaxThera drug programs. MaxThera shareholders will also be entitled to 12% of all up-front and milestone fees received by Biota if the two main drug candidates are licensed.

Commenting on the Prolysis deal, Biota CEO, Peter Cooke, says, “This acquisition will enable Biota to expand its drug development capability by extending its current antiviral portolio to include a new pipeline of early-stage antibacterial programs.” He adds that the MaxThera portolio of new targets and novel inhibitor structures “are highly complementary to Biota’s own innovative programs, and the two organizations have very similar systems and discovery strategies.”
  
Biota originally discovered the seasonal flu drug, zanamivir, which it licensed to GlaxoSmithKline in 1990. GSK commercially launched the drug as Relenza in 1999. Relenza is now available in over 50 countries worldwide and is stockpiled by a number of governments. Biota made $45 million in Relenza-related royalties in the first six months of this year. In October GSK notified Biota that Relenza sales for the third quarter reached $331 million and that it estimated royalty payments of some $24.1 million for that period alone.

Biota’s existing antiviral pipeline comprises programs in influenza, respiratory syncytial virus (RSV), human rhinovirus (HRV), HCV, and human cytomegalovirus (CMV). Key milestones from Biota’s in-house projects during 2009 included the achievement of Phase IIa clinical proof-of-concept with a lead human rhinovirus drug, BTA798.

The company also has a license and collaboration agreement with Boehringer Ingelheim to develop and commercialize Biota’s nucleoside analogues against HCV infections and potentially other diseases.

In 2003, Biota and Daiichi Sankyo merged their respective inhaled long-acting neuraminidase inhibitor (LANI) influenza programs including CS-8958, which was originally discovered by Daiichi Sankyo. During mid-2009 the companies reported positive results from a Phase III therapeutic trial with laninamivir in Asia. Daiichi Sankyo also exercised its right to market laninamivir in Japan. An application for Japanese approval of laninamivir as a treatment for adult and paediatric flu is expected to be submitted by March 2010.

Earlier this month Biota and Daiichi Sankyo started another Phase III trial evaluating the efficacy of laninamivir for the prevention of flu. Other LANI compounds in the joint pipeline are available for licensing.