Novelos Therapeutics, Inc., a biopharmaceutical company focused on the development of therapeutics to treat cancer and hepatitis, announced that Novelos signed an exclusive collaboration agreement with Mundipharma International Corporation Limited to commercialize in Europe and Asia/Pacific (excluding China) Novelos' lead compound, NOV-002, which is in a pivotal phase 3 trial for non-small cell lung cancer under a Special Protocol Assessment (SPA) and Fast Track. NOV- 002 has also demonstrated positive results in phase 2 trials for other cancer indications.
In parallel, Novelos has also closed a private placement with Purdue Pharma L.P. resulting in $10 million in gross proceeds through the sale of convertible preferred stock and warrants to purchase its common stock. Novelos sold 200 shares of Series E convertible preferred stock, having a stated value equal to $50,000 per share, a cumulative annual dividend of 9% of stated value and a conversion price of $0.65 per share of common stock. Purdue also received warrants expiring on December 31, 2015 to purchase an aggregate of 9,230,769 shares of common stock at an exercise price of $0.65 per share.
Under the terms of the collaboration agreement, Novelos may receive up to $25 million of launch milestones and $60 million of fixed sales-based payments. Novelos will receive a double-digit royalty, which increases as the annual sales increase in the licensed territories. Mundipharma will be responsible for certain development activities, regulatory submissions and commercialization of NOV-002 in the licensed territories. Novelos retains all rights and responsibilities in the USA and the rest of the Americas.
"I am very pleased to be collaborating with Mundipharma and Purdue, which are innovative independent associated pharmaceutical companies with ample resources and a proven track record of developmental and commercialization expertise," said Harry Palmin, President and CEO of Novelos. "This transaction will provide the remaining capital to complete our pivotal, fully-enrolled, 840-patient Phase 3 lung cancer trial, which is currently expected to conclude in late 2009."
According to Åke Wikström, Mundipharma's regional director – Europe, "NOV-002 is an important addition to our oncology pipeline and reinforces our commitment to increasing the treatment options available for cancer patients and improving their quality of life through the development and commercialization of novel therapeutics."
The Purdue/Mundipharma/Napp independent associated companies are privately owned companies and joint ventures covering the world's pharmaceutical markets. The companies have particular expertise in drug delivery systems and these are applied to a range of analgesics, respiratory treatments, and cardiovascular drugs.
Novelos Therapeutics, Inc. is a biopharmaceutical company commercializing oxidized glutathione-based compounds for the treatment of cancer and hepatitis. NOV-002, the lead compound currently in phase 3 development for lung cancer under SPA and Fast Track, acts together with chemotherapy as a chemoprotectant and a chemopotentiator. NOV-002 is also in phase 2 development for early-stage breast cancer and chemotherapy-resistant ovarian cancer.