Washington Editor

Theravance Inc. could receive in excess of $252 million under terms of a new license agreement with a familiar partner, GlaxoSmithKline plc.

In the preclinical deal, the London-based pharmaceutical firm exercised its option to license Theravance's inhaled bifunctional muscarinic antagonist/beta2 agonist (MABA) program as part of their broad alliance formed nearly a year ago. That partnership provides GSK access to a variety of Theravance's portfolio products for a number of therapeutic areas including respiratory disease, overactive bladder and gastrointestinal disorders. Part of that $129 million deal provided for GSK to increase its 6 percent ownership of Theravance to 19 percent. (See BioWorld Today, April 1, 2004.)

The South San Francisco-based company's MABA program is the third respiratory program GSK has licensed, following prior deals related to long-acting beta2 agonist (LABA) and long-acting muscarinic antagonist programs. The LABA deal has a potential worth of $545 million for Theravance. (See BioWorld Today, Jan. 7, 2003.)

Officials at the company could not be reached for comment, though in a press release, its executive vice president of research, Pat Humphrey, said, "We combined bifunctional activity and high lung selectivity to identify a potential medicine with greater efficacy and equal or better tolerability than single-mechanism bronchodilators. We also pursued this program because we believe this type of bifunctional molecule could serve as a basis for improved triple therapy' through co-formulation with another inhaled respiratory compound into a single product that could potentially deliver three complementary therapeutic effects for patients with respiratory disease."

According to its press release, in exchange for the latest license, Theravance could receive up to $252 million in up-front and milestone payments, should the program produce both single-agent and combination products and if certain milestones are achieved. It also would get royalties on any sales. Effective immediately, GSK will fund all future development, manufacturing and commercialization activities for product candidates stemming from the MABA program, which is generating long-acting inhaled bronchodilators that function both as muscarinic receptor antagonists and beta2 receptor agonists.

The compounds are under investigation for their potential to treat patients with chronic obstructive pulmonary disease and, possibly, asthma. The lead candidate, TD-5959, already is in preclinical development.

Pursuant to another area of the companies' wide-ranging relationship, GSK declined its option to license Theravance's short-acting sedative-hypnotic program. As a result, Theravance is free to pursue its development alone or with another partner.

For the Theravance programs GSK accepts, the latter will pay for further development, manufacturing and commercialization activities, as well as provide milestone payments ranging from $162 million to $240 million per program.

Theravance, which last fall completed a $98.4 million initial public offering, has a late-stage product in partnership with GSK, the Beyond Advair collaboration. Another of its clinical-stage products is telavancin, its lead investigational antibiotic that is in Phase III studies. Its overall research efforts are directed at respiratory disease, bacterial infections, overactive bladder and gastrointestinal motility disorders. (See BioWorld Today, Oct. 8, 2004.)

On Tuesday, its shares (NASDAQ:THRX) gained 11 cents to close at $18.19.