Cephalon Forms Strategic Alliance with Mesoblast
BY LAUREN UZDIENSKI, DECEMBER 9, 2010
Cephalon has entered into a strategic alliance with Mesoblast, paying $130 million up front and up to an additional $1.7 billion in milestone payments related to stem cell applications for degenerative conditions of the cardiovascular and central nervous systems as well as augmenting hematopoietic stem cell transplantation in cancer patients. Additionally, Cephalon has acquired a 20% stake in Mesoblast valued at $220 million.
Per the agreement, Cephalon will have exclusive world-wide rights to commercialize specific products based on Mesoblast's Mesenchymal Precursor Stem Cells (MPCs). Mesoblast will be responsible for the conduct and expenses of certain Phase IIa clinical trials and commercial supply of the products. Cephalon will be responsible for the conduct and expenses of all Phase IIb and III clinical trials and subsequent commercialization of the products. Mesoblast will retain all manufacturing rights, and the press release notes that the company "will share significantly in the net product sales."
Cephalon is a biopharmaceutical company with over $700 million in sales. The company's products include pain medications and treatments for leukemia, seizures, muscle spasm and excessive sleepiness. Mesoblast is developing its stem cell technology for a range of applications, including spinal fusion, knee OA, long bone fracture repair and intervertebral disc repair.
The transaction helps demonstrate the appetite of big pharma for stem cell products. In 2008, Pfizer launched its Regenerative Medicine division and subsequently partnered with Athersys on MultiStem, the company's adult stem cell treatment. Pfizer has also invested in EyeCyte, which is developing stem cell treatments for eye applications. Johnson & Johnson is an investor in ViaCyte (formerly Novocell), which is working on cell-based treatments for diabetes; ViaCyte also signed a collaboration agreement with Pfizer, granting Pfizer access to ViaCyte's pancreatic progenitor cell technology. Genzyme partnered with Osiris to develop Prochymal and Chondrogen, a stem-cell-based OA treatment. Further, Roche, Pfizer and GSK are using stem cells to more safely and cheaply test drugs.
