GlaxoSmithKline enters drug development deal with Dynavax, potentially worth more than $800 million

On Wednesday, GlaxoSmithKline and Dynavax Technologies reported that the companies are partnering to discover, develop and market first-in-class inhibitors of endosomal Toll-like receptors for the treatment of immuno-inflammatory diseases, in a deal that could be valued at more than $800 million for the US biotechnology firm.

Under the terms of the deal, GlaxoSmithKline will receive an exclusive option over four programmes to be operated by Dynavax, targeting diseases such as lupus, psoriasis, and rheumatoid arthritis. The UK drugmaker can exercise its exclusive option to license each programme upon achievement of proof-of-concept or possibly earlier, the companies stated.

Dynavax, which will receive $10 million upfront, will undertake research and early clinical development of the programmes and is eligible to receive future milestone payments totalling approximately $200 million per programme. In addition, the biotech firm will receive up to double-digit royalties on sales of any approved drugs, and has retained an option to co-develop and co-promote one product.

Dynavax's lead inhibitor drug candidate, DV1079, is expected to enter development in the fourth quarter of 2009.

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