GSK raises stake in Amicus, expands collaboration
(Reuters) - GlaxoSmithKline (GSK.L) will increase its ownership in Amicus Therapeutics Inc (FOLD.O) to 19.9 percent in exchange for an expanded development and licensing deal on the drug developer's experimental treatment for Fabry disease.
According to the expanded deal, UK-based GSK will co-develop all current and future formulations of the treatment migalastat hydrochloride, or AT1001, in exchange for rights to market the product outside the United States.
AT1001, also called Amigal, is being tested in a late-stage study as a treatment for the enzyme deficiency that results in the accumulation of a lipid in blood vessels and tissues.
GSK and Amicus signed a $230-million deal in October 2010 to develop and market the current form of Amigal.
GSK had a 14.9 percent stake in Amicus as of March 7, 2012.
Under the terms of the extended deal, GSK will fund 75 percent of development costs for all formulations of AT1001 and pay Amicus $3.5 million in milestone payment.
GSK will be eligible for milestone payments worth $35 million and royalties if a co-formulated version of the treatment reaches the market in the next seven years.
Shares of Cranbury, New Jersey-based Amicus, which have gained nearly 80 percent since the beginning of the year, were up 7 percent at $6.45 after the bell. They closed at $6.02 on Tuesday on the Nasdaq. (Reporting by Vidya P L Nathan in Bangalore; Editing by Roshni Menon)
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