In a move that gives Inovio Pharmaceuticals (NYSE: INO) its second big pharma partnership, it’s signed a global licensing deal with Swiss drug developer Roche (OTCQX: RHHBY) for its DNA vaccines for Hepatitis B and prostate cancer. The deal could add up to more than $412 million.
A DNA vaccine is a bit like gene therapy. It inserts a small amount of DNA into patients’ cells, and that triggers an immune response.
Under the terms of the agreement, Roche will initially pay $10 million to Inovio. Roche will also provide preclinical research and development support and payments for near-term regulatory milestones as well as milestone payments of up to $412.5 million. Additional development milestone payments could also be made to Inovio if Roche pursues other indications with INO-5150, its prostate cancer vaccine or INO-1800, its Hepatitis B vaccine. In addition, Inovio is entitled to receive up to double-digit tiered royalties on product sales, according to the statement. The deal also gives Roche the option of using Inovio’s electroporation drug delivery method.
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Electroporation uses an electrical charge to make cell membranes more porous in order to introduce a molecule or DNA code to change the cell’s function, a method called electroporation. It transmits the charge through a scratch on the skin surface.
Although it’s a big move for Inovio, it’s not the first big pharma deal it has made. In 2004, Merck acquired the worldwide non-exclusive rights to use Inovio’s electroporation technology for intramuscular delivery of certain proprietary DNA vaccines, according to its website. Still, it’s a critical turning point for the drug developer that adds validation to its technology.
In a conference call with analysts, Dr. J. Joseph Kim, Inovio’s President and CEO described the deal “as a watershed moment” for the business. In a statement he said: “Collaborating with the world’s pre-eminent oncology development partner allows us to rapidly advance two of our promising near-clinical stage immunotherapy products from our product pipeline…”
Kim added in the conference call that part of this agreement includes research funding where it will explore additional treatments for prostate cancer and could provide additional royalties to Inovio. “Roche has taken a couple of our first round draft picks but we still retain some of our star players.”
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The Blue Bell, Pennsylvania company is gearing up for human trials of its malaria vaccine next year. It also has a late stage cervical cancer vaccine for cervical cancer caused by the human papilloma virus. It expects to have topline data for It Phase 2 studies by mid 2014.
Earlier this year it received a $3.5 million grant from National Institute of Allergy and Infectious Diseases as part of a project to ensure that the military and public can get rapid access to vaccinations for multiple infections.
