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Albany Molecular Research in Licensing Deal With Bristol-Myers

Posted on: Tuesday, 25 October 2005, 12:00 CDT

By Eric Anderson, Times Union, Albany, N.Y.

Oct. 25--ALBANY -- In a deal that could yield $150 million or more, Albany Molecular Research Inc. announced on Monday a licensing agreement with Bristol-Myers Squibb Co. that gives the pharmaceutical company the right to a group of Albany Molecular proprietary compounds.

"It's probably the most significant announcement to come out of our internal research and development side since the Allegra announcements," said spokesman David Albert.

Albany Molecular holds the patents on the manufacturing process for fexofenadine hydrochloride, the active ingredient in Allegra, a prescription allergy medication. The Albany-based contract research company receives about $50 million annually in royalty payments from Allegra's manufacturer, Aventis Pharmaceuticals Inc.

The compounds involved in Monday's agreement, biogenic amine reuptake inhibitors, will be further developed by Bristol-Myers Squibb for pre-clinical and clinical testing. Those tests are required for U.S. Food and Drug Administration approval. Albany Molecular, meanwhile, will continue further discovery research on the compounds.

"We're handing off to Bristol-Myers Squibb a series of compounds that they can then develop" into marketable drugs, Albert said.

The compounds are expected to be useful in the treatment of depression and other central nervous system disorders, the Albany company said in a statement.

Bristol-Myers Squibb will pay Albany Molecular $8 million immediately, plus $10 million in additional research funding over three years. Albany Molecular will also be eligible to receive up to $66 million in payments for each of the first two compounds that reach development and regulatory milestones.

Additional compounds meeting those milestones will net the Albany company up to $22 million each.

Albany Molecular would also receive royalties from any compound that develops into a marketable product, Albert said.

The agreement comes as Albany Molecular seeks to stop a generic version of Allegra from reaching market. On Thursday, the U.S. District Court in New Jersey will hear a motion by Albany Molecular and Aventis for a preliminary injunction or expedited trial as they seek to block the generic form from being marketed.

The companies want to stop Barr Pharmaceuticals Inc., Teva Pharmaceutical Industries Ltd., Ranbaxy Laboratories Ltd. and Amino Chemicals Ltd. from marketing unlicensed generic versions of Allegra.

Albany Molecular and Aventis filed their motion Sept. 20 after Barr and Teva said they would collaborate to launch a generic version of Allegra.

David H. Windley, an analyst with the New York City-based investment bank Jefferies & Co. Inc., said he agreed with Albany Molecular's assessment that Monday's announcement was significant.

But "if you look through their history, it's also one of the few announcements out of their (research and development) pipeline since their announcement with Allegra," Windley said.

Bristol-Myers Squibb originally owned these compounds, he said, but turned them over to Albany Molecular as compensation for reducing its chemistry services contract with the company in 2002.

Still, he said, "this is a positive, though very long-term, opportunity for AMRI."

Shares of Albany Molecular (Nasdaq: AMRI) gained 64 cents, or nearly 5 percent, to close Monday at $13.46.

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Copyright (c) 2005, Times Union, Albany, N.Y.

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AMRI, BMY, SNY, SAN, BRL, TEVA, RBXZF, RANB, JEF,

Source: Times Union

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