TransTech Pharma Inc. Secures $1.1 Billion Partnership with Forest Laboratories Inc. to Develop Groundbreaking Glucose-Lowering Agents

Strategic Insights -

Privately held biotech firm TransTech Pharma Inc. has entered into a collaborative agreement with Forest Laboratories Inc. to develop and commercialize a new class of glucose-lowering agents, known as functionally liver-selective glucokinase activators (GKAs). This innovative partnership is expected to yield over $1.1 billion in revenue for TransTech, with the company receiving a $50 million up-front payment and royalties on worldwide sales. The deal marks a significant milestone for TransTech, with CEO Adnan Mjalli hailing it as a "game-changer" for both his firm and Forest, as well as the millions of patients worldwide seeking treatment for diabetes.

Key Takeaways:

  • TransTech Pharma Inc. is set to gain over $1.1 billion in revenue from its partnership with Forest Laboratories Inc. to develop and commercialize GKAs, a new class of glucose-lowering agents.
  • The collaboration involves a $50 million up-front payment for TransTech, as well as royalties on worldwide sales.
  • TransTech has developed a portfolio of GKA molecules, including three Phase I compounds and four preclinical candidates.
  • The GKAs work by selectively activating glucokinase in the liver, increasing glucose utilization and lowering blood glucose levels without inducing excessive insulin secretion.
  • This unique mechanism of action also appears to have a beneficial cardiovascular effect, lowering triglycerides and cholesterol.
  • Forest Laboratories Inc. is responsible for all development and commercialization costs under the partnership, with the deal's economics "back-end loaded" to provide incentives for success.
  • Investors were initially skeptical about the partnership, with Forest's stock price falling 28 cents on the news.

Statistics:

  • The partnership is expected to generate over $1.1 billion in revenue for TransTech Pharma Inc.
  • The deal includes a $50 million up-front payment for TransTech.
  • Forest Laboratories Inc. is responsible for all development and commercialization costs under the partnership.
  • The GKAs have shown promise in Phase I studies, with TTP399 set to soon enter Phase II.
  • Glucokinase controls insulin secretion in the pancreas and is a major regulator of glucose metabolism in the liver.
  • A reduction in hepatic glucose utilization may contribute to hyperglycemia in people with Type II diabetes.
  • The partnership has the potential to bring improved treatment options for the millions of patients worldwide suffering from diabetes.

Sources:

  • Contify.com, "TransTech Pharma and Forest Laboratories partner on diabetes treatments", December 8, 2010 (cited as Euclid Infotech, 2010)