Cephalon pays $30 million option to acquire BioAssets Development Corp

US privately-held Cephalon has signed an option agreement to acquire BioAssets Development Corp (BDC). Under the terms of the deal, Cephalon will pay BDC an upfront $30 million and, assuming exercise of the option, an additional amount on the closing of the transaction. BDC stockholders could also receive additional future payments related to regulatory and sales milestones. The accord is subject to customary closing conditions, including the receipt of necessary BDC stockholder approvals.

BDC is currently conducting a Phase II placebo-controlled proof-of-concept study with the tumor necrosis factor (TNF) inhibitor, etanercept, epidurally administered to a minimum of 40 patients with sciatica, a neuropathic inflammatory pain condition that occurs when the sciatic nerve is compressed, injured or irritated. BDC has secured an intellectual property estate around use of TNF inhibitors for sciatic pain in patients with intervertebral disk herniation, as well as other spinal disorders.

"BioAssets offers an estate of intellectual property and scientific expertise that will allow us to evaluate our own domain antibody tumor necrosis factor inhibitor, CEP-37247 (formerly known as ART-621), for the treatment of sciatica," said Frank Baldino, Jr, chairman and chief executive of Cephalon. "Combining these two innovations helps fulfill our strategy to address unmet patient needs, while focusing on specialty physicians," he added.

Cephalon may exercise its option at any time from the closing date of the option agreement until the date that is 60 days after receipt of one-month patient response data from the Phase two proof of concept study. Data are anticipated to be available in the second half of 2010.