AstraZeneca gains rights to additional compounds and will sponsor more clinical trials.
AstraZeneca and Palatin Technologies have prolonged their obesity research and license arrangement related to compounds that target melanocortin receptors. The firms also inked a clinical trial sponsored research deal. The new deals are valued at $6 million.
AstraZeneca will pay Palatin Technologies $1.6 million upfront to gain rights to additional compounds and patents. Additionally, the research collaboration term has been extended, during which time Palatin will contribute scientific expertise, and AstraZeneca will support Palatin’s internal activities at a full-time equivalent rate.
Under the clinical trial sponsored research deal, Palatin will be responsible for conducting a study of the effects of melanocortin receptor specific compounds on food intake, obesity, and other metabolic parameters.
Palatin will be eligible for milestone payments totaling $5 million in connection with the collaboration and license agreement. “This $6.6 million, coupled with $1.7 million that Palatin received this month from the sale of net operating losses to the State of New Jersey, $700,000 from the sale of noncore fixed assets, and a cash and cash equivalents balance of $8.1 million at September 30, 2008, gives Palatin sufficient cash to fund its projected operations through calendar year 2009,” according to Stephen T. Wills, Palatin’s EVP of operations and CFO.
Under the original collaboration and license agreement signed in January 2007, Palatin initially received $10 million from AstraZeneca. The deal also called for $300 million in milestones, of which $180 million depends on development and regulatory achievements and the rest rides on meeting sales targets. Palatin also stands to earn stepped royalties on product sales to double-digit rates.