Roche drug deal windfall for Industrial Research

Government science company Industrial Research Ltd looks set for a healthy injection of cash as one of the drugs it developed is licensed to pharmaceutical multinational Roche.

US-based BioCryst Pharmaceuticals - which licensed the psoriasis drug BCX-4208 from IRL two years ago - has flicked it on to F. Hoffmann-La Roche as a compound for treating transplant rejection and autoimmune diseases.

The new licensee, a unit of Swiss drugs giant Roche Holding, is paying Alabama-based BioCryst $US25 million ($NZ35.9 million) in an up-front payment, as well as a $US5 million reimbursement payment for supply of material during the first two years of the collaboration.

But future milestone payments could reach $US530 million, in addition to royalties on product sales of BCX-4208, a biotechnology news website, bioworld.com, reported.

The news sparked a 37.5 per cent increase in BioCryst shares on the Nasdaq.

Because the company licensed BCX-4208 from IRL and its collaborator, Albert Einstein College of Medicine at New York's Yeshiva University, it will owe them sub-licence payments from the up-front payment, future event payments and any eventual royalties.

- NZPA