Glenmark Pharma Surges After Selling Drug Rights to Sanofi
Stock Chart for Glenmark Pharmaceuticals Ltd (GNP)
Glenmark Pharmaceuticals Ltd. (GNP) surged the most in 10 weeks in Mumbai after selling rights to develop an experimental multiple sclerosis treatment to Sanofi.
Glenmark will get cash payments totaling $50 million in the next three months and as much as $613 million if the medicine achieves development targets, the Mumbai-based company said in a statement today. It could also get sales royalties if the drug clears all clinical trials and regulatory hurdles.
The deal will enable Paris-based Sanofi to develop and market the experimental drug, known as GBR 500, in North America and Europe. The antibody is designed to block the movement of a type of white blood cell involved in inflammation, and may treat conditions such as multiple sclerosis and Crohn’s disease, which affects the bowels.
Glenmark, the Indian drugmaker developing seven new treatments for pain, inflammation and metabolic disorders, surged 11.7 percent, the most since March 1, to 306.1 rupees at the 3.30 p.m. close in Mumbai. The benchmark Sensitive Index declined 0.1 percent. Sanofi stock rose 0.1 percent at 3:14 p.m. in Paris trading.
GBR 500 is a monoclonal antibody, which belongs to a class of drugs that are made from living cells and are more difficult to make than chemical medicines because of their molecular complexity. They are also sold for higher prices.
“This is definitely significant because it’s the first time an Indian company has developed the expertise” to make these so-called biologic drugs, Bino Pathiparampil, a pharmaceutical analyst at IIFL Institutional Equities Ltd., said in a telephone interview.
The sale comes almost four years after the 34-year old drugmaker acquired the technology to make the GBR 500 injection treatment from Chromos Molecular Systems Inc., a biotechnology company based in British Columbia.
The acquisition from Chromos was “one of the best investments made by the company,” Managing Director Glenn Saldanha told reporters today. “We anticipate that the drug could be launched by 2017.”
Multiple sclerosis affects about 2.1 million people in the world, including 400,000 patients in the U.S., according to the New York-based National Multiple Sclerosis Society. The chronic disease attacks the central nervous system and can cause numbness in limbs, paralysis and vision loss.
Teva Pharmaceutical Industries Ltd.’s Copaxone and Biogen Idec Inc.’s Avonex, the world’s two biggest multiple sclerosis treatments, had combined sales of more than $5.8 billion in 2010, according to Bloomberg data.
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