As part of a multiyear collaboration to gain access to Israeli-sourced drug candidates, Novartis Pharma made a $10 million initial equity investment in Jerusalem-based BioLineRx for 12.8% of the company’s current shares outstanding.
BioLineRx will leverage its close ties with Israeli academic institutions, hospitals, and biomedical companies while the Swiss drugmaker will evaluate projects identified and presented by BioLineRx for co-development and potential future licensing. The companies are planning to develop up to three clinical programs.
Novartis will evaluate clinical and preclinical stage projects presented by BioLineRx via a Joint Steering Committee. Once projects reach the clinical stage they will be eligible for selection by Novartis. If selected, Novartis will pay BioLineRx an option fee of $5 million, as well as fund half of the remaining development costs in the form of an additional equity investment.
Novartis will have an exclusive right of first negotiation to license each project from BioLineRx upon establishment of clinical proof-of-concept.
BioLineRx’s has long-lasting relationships with Israeli research institutions. In June 2011, the company agreed to develop an inflammatory bowel disease candidate, BL-7040, originating from research at the Hebrew University of Jerusalem. That same year, BioLineRx inked a deal with Ramot at Tel Aviv University for the development and commercialization of BL-7050, a treatment for neuropathic and inflammatory pain.