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Genentech and Scios Nova Collaborate on Auriculin for Acute Renal Failure Treatment

Strategic Insights

— 2 min read

Genentech, a leading international biotechnology company, and Scios Nova, a biopharmaceutical company, have entered into a collaboration agreement to develop and commercialize Scios Nova's Auriculin (anaritide) for the treatment of acute renal failure (ARF). The partnership aims to leverage Genentech's expertise in clinical development and marketing with Scios Nova's proprietary product, Auriculin, to accelerate its market penetration in North America and beyond.

Key Takeaways:

  • The collaboration agreement involves the joint development and commercialization of Auriculin for ARF in the United States and Canada, with Genentech and Scios Nova co-promoting the product equally.
  • Genentech will have exclusive marketing rights to Auriculin in all markets outside North America, while Scios Nova will receive a royalty on sales.
  • Genentech has made a $20 million equity investment in Scios Nova by purchasing nonvoting preferred stock convertible into approximately 2.1 million shares of common stock at a price equivalent to $9.50 per common share.
  • Scios Nova will receive $30 million from Genentech, which will be used as a loan at its discretion through 2002.
  • The partnership will provide Genentech with a significant market share in the ARF treatment market, while Scios Nova will have access to the necessary resources and expertise for commercialization.
  • The agreement includes milestone payments of up to $100 million, excluding royalties and profit sharing, including $30 million upon FDA marketing approval of Auriculin.
  • The partnership is consistent with Scios Nova's strategy to develop an acute-care marketing presence in North America and to form an alliance for commercialization outside North America.
  • ARF is a life-threatening condition that affects more than 160,000 people in the United States annually, for which there is no available treatment apart from dialysis.
  • Auriculin has been designated an orphan drug for the treatment of ARF, and Scios Nova is currently conducting a 500-patient Phase III clinical study to support marketing approval in the United States.

Statistics:

  • $20 million: Genentech's equity investment in Scios Nova
  • $30 million: Loan provided by Genentech to Scios Nova
  • $100 million: Total milestone payments possible under the agreement
  • $50 million: Milestone payment upon FDA marketing approval of Auriculin
  • 2.1 million: Number of Scios Nova common shares convertible from nonvoting preferred stock
  • 160,000: Number of people affected by ARF in the United States annually
  • 500: Number of patients in Scios Nova's Phase III clinical study
  • 1995: Expected completion date for enrollment in the Phase III clinical study

Sources:

  • "Genentech and Scios Nova Inc. Announce Collaboration Agreement for Development and Commercialization of Auriculin" (Business Wire, January 3, 1995)
  • Scios Nova's press release (January 3, 1995)

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