Genesis announces major licensing deal

Wednesday 4th October 2000

Newly listed sharemarket darling Genesis Research and Development Corporation has announced a licensing deal with a major U.S. pharmaceutical firm, Medicis Pharmaceutical Corporation. Potential revenues from the deal could exceed US$50 million.

The deal is for distribution rights to the PVAC psoriasis treatment which is currently undergoing Phase II trials in the United States. These trials are expected to be completed by the end of this year, with Phase III trials anticipated to begin in 2001. Sales of PVAC will only start if the Phase III trials are successful and subsequent U.S. regulatory approvals are granted.

The PVAC treatment is jointly owned by Genesis and Corixa Corporation, a NASDAQ listed biotechnology company. Corixa, who finalised the deal, has already sold the Japanese commercialisation rights for the PVAC treatment to Zenyaku Kogyo Pharmaceuticals. CEO of Genesis, Dr James Watson, said that Corixa is also wanting to sell the marketing rights in Europe and the rest of the world.

"Under this arrangement with Medicis, Genesis retains certain rights in its intellectual property and gets the opportunity to derive significant income from future sales," Dr Watson said.

With a revenue stream that could deliver a good profit for Genesis, investors will be hoping that the PVAC trials are successful. As with all drug trials though, there is no certainty that the product will ever hit the market. However, early indications are positive - results to date in the Phase I/II stages have been encouraging with just over half of the patients having complete responses to the therapy.

Genesis was tracking up in late-morning trading in response to the news with the share price fluctuating around $7.10.

Comments from our readers

No comments yet