Helsinn in-licenses pracinostat for AML and other hematologic diseases from MEI Pharma

Privately-held Swiss drugmaker Helsinn and US oncology therapies developer MEI Pharma (Nasdaq: MEIP) have entered into an exclusive licensing, development and commercialization agreement for pracinostat, a Phase III-ready drug candidate for the treatment of acute myeloid leukemia (AML) and other potential indications.

The deal provides the complementary resources from both organizations to rapidly advance pracinostat, for which MEI gained rights to from Singapore’s privately-held biotech firm S*BIO Pte in 2012, into Phase III clinical development and expand into additional indications, including high-risk myelodysplastic syndrome (MDS).

Deal with a potential $469 million for MEI Pharma

MEI Pharma saw its shares rocket as much as 51% in pre-market trading, on news of the deal that could generate up to $469 million for the company, although it levelled off to $2.10 for a 30% rise by mid-morning. Under the terms of the accord, Helsinn will get exclusive worldwide rights, including manufacturing and commercialization rights, and will be responsible for funding the global development of Pracinostat. As compensation for such grant of rights, MEI Pharma will receive near-term payments of $20 million, comprised of a $15 million upfront payment and a $5 million payment upon dosing of the first patient in the upcoming Phase III study of pracinostat in newly diagnosed AML patients unfit to receive induction therapy. In addition, MEI Pharma will be eligible to receive up to $444 million in potential development, regulatory and sales-based milestone payments, along with additional tiered royalty payments in selected territories.