ALS drug brings payoff
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Knopp Neurosciences is selling global licensing rights to its Lou Gehrig's disease drug to Biogen Idec, a deal that could provide up to $345 million in funding to the South Side biopharmaceutical development company and bolster the region's biotechnology aspirations.
Wednesday's announcement also marks a big payoff for two local tech investors who backed the South Side company: Innovation Works and LaunchCyte LLC.
Knopp will receive an initial investment of $80 million from Biogen Idec -- a payment of $20 million and a $60 million investment in Knopp stock. The small company could receive another $265 million from its Massachusetts-based partner, depending on the drug's ability to get regulatory approval and how well it sells.
Those payments do not include the double-digit royalties Knopp will receive if the drug makes it to market.
Under the terms of the agreement, Biogen Idec will cover the costs of a final round of testing before the drug is submitted for approval to the U.S. Food and Drug Administration and to regulators in other countries.
Knopp's investors have funded two rounds of earlier tests that demonstrated the drug can slow the pace of the fatal disease by as much as 50 percent, said Michael Bozik, the company's president and CEO.
Dr. Bozik calls Lou Gehrig's disease, also know as amyotrophic lateral sclerosis or ALS, "an incredibly malignant disease." It attacks the muscles of its victims, depriving them of the ability to walk, talk, breath and eat. It is named after former New York Yankees slugger Lou Gehrig, who died from the disease.
In exchange for the investment, Knopp will provide development support and help Biogen Idec commercialize the drug in the U.S. market.
First Published August 19, 2010 12:00 am
