Genzyme and Isis finalize cholesterol drug deal

Genzyme Corp. and Isis Pharmaceuticals Inc. said Tuesday they finalized their agreement to give Genzyme exclusive rights to mipomersen, a cholesterol drug candidate discovered and developed by Isis.

Under original terms of the deal, first announced in January, Genzyme bought five million Isis shares for $150 million and agreed to pay Isis a $175 million upfront license fee.

The companies now say Isis will contribute up to $50 million in additional development funding for mipomersen, bringing the company's funding commitment up to $125 million. After that, Isis and Genzyme will share development costs equally.

In exchange for the additional contribution, Isis may receive $75 million in milestone payments early.

Mipomersen is currently in late-stage trials to treat patients with homozygous familial hypercholesterolemia, a severe form of high cholesterol. The companies expect to apply with the Food and Drug Administration in the second half of 2010 for approval, and will approach regulatory authorities in Europe.

The companies said other financial terms are unchanged under the final agreement. Isis is eligible to receive up to $750 million in commercial milestone payments and up to $825 million in development and regulatory milestone fees.

Genzyme and Isis will share mipomersen profits on a sliding scale. The split will be 50/50 when annual revenue reaches $2 billion.

As part of the relationship, Genzyme will also have preferred access to future Isis drugs for certain diseases.

Genzyme Chairman and Chief Executive Henri A. Termeer said the company will manage mipomersen's clinical development within its current budget and financial guidance.

In morning trading, Genzyme shares fell 19 cents to $69.81 and Isis shares dipped 3 cents to $14.