Cephalon set to spend $22 million for Alba's celiac disease assets

US drugmaker Cephalon (Nasdaq: CEPH) has signed an agreement providing an option to purchase all of privately-held Alba Therapeutic's assets relating to larazotide acetate, a tight junction modulator, progressing toward a Phase IIb clinical trial for the treatment of celiac disease.

Under the terms of the option accord, Cephalon will pay Alba a $7 million upfront and will provide a credit facility to fund Alba's Phase IIb clinical trial expenses for larazotide acetate. Cephalon may exercise its option at any time prior to the expiration of a specified period after receipt of the final study report for the Phase IIb clinical trial. If Cephalon exercises its option, the company will buy Alba's assets for $15 million. Alba could receive additional payments related to regulatory and sales milestones.

"We are encouraged by the data that we have evaluated," said Kevin Buchi, Cephalon's chief executive, adding: "Alba will now initiate a Phase IIb trial utilizing a more disease specific primary endpoint. If successful, larazotide acetate will add to our pipeline in immunology and has the potential to be the first pharmacologic therapy available to treat patients who endure this often serious condition."