Another area based biotechnology company has partnered with a company on the other side of the country, a much larger company, far, far away from here.
This time it's Rockville based Micromet, Inc.
Micromet, Inc labels itself as a biopharmaceutical company focused on finding treatments for cancer through commercialization of innovative antibody based therapies. The company traces its root back to 1993 in Munich, Germany where a small group of scientists set upon treating cancer via T cell based therapies.
The Montgomery County, Maryland drug company has formed a partnership to the tune of almost $1 Billion with one of the largest biotech companies in the world. Thousand Oaks, California based Amgen is one of the last remaining large and independent biotechnology firms. The company has a market capitalization of over $50 Billion.
"We are very pleased to collaborate with Amgen, an industry leader with a proven track record of success in oncology and biologics," said Christian Itin, Ph.D., Micromet's President and Chief Executive Officer. "This collaboration aligns well with our strategy to expand development of BiTE antibodies into solid tumor indications with support from a partner and brings important non-dilutive capital into the company."
Amgen's California rival Genentech was purchased in 2009 by Basel, Switzerland, Roche Holding AG. The pharmaceutical giant bought the biotech for over $47 Billion. Even with Genentech's large size, it's purchase showed that no biotech is safe from a buyout by Big Pharma.
Considering those facts, this is most likely what the CEO and management wants for the good of the shareholders which, not coincidentally includes the CEO and management.
The same happens in the Baltimore-Washington area, partnerships with large pharmaceutical companies in this area often lead to a buyout, the largest acquisition of a biotech happened in 2007 when Gaithersburg based MedImmune was purchased by U.K. based AstraZeneca for over $15 Billion.
Micromet would be considered small cap elsewhere but has quickly grown to become one of larger mid-sized biotech's measured by Mid-Atlantic standards.
The deal between Micromet and Amgen calls for Amgen to deliver an upfront payment of $14.2 Million to Micromet as soon as the agreement goes into effect. Several milestones must be met in the clinical and commercial stages for payments of up to $484.1 Million. Only when the possibility of worldwide sales goals are included could Micromet reap almost $984 Million from royalty dues.
The research based on the BiTE antibodies, which are designed todirect the body's cell-destroying, T cells against tumor cells that cause cancer is what lured Amgen to this partnership. But Micromet may seem to have capped its value with this deal assuming it does not have other drugs in its' development pipeline, which it does but unfortunately BiTE antibodies products are the bulk of it. Which means Amgen has essentially bought its most promising pipeline.
"The BiTE antibody provides an innovative approach to cancer therapy," said Roger M. Perlmutter, M.D., Ph.D., executive vice president of Research and Development at Amgen. "Amgen is pleased to collaborate with the Micromet scientific team to deploy this technology against targets for the treatment of solid tumors."
The other good news is that Amgen will carry the expenses, funding research, development and commercialization. That will total $35.4 Million in the initial phase of the drug development.
Micromet has a market cap of approximately $568 Million, the company increased revenues to $28.7 Million in 2010.