Biotechnology companies Genzyme and PTC Therapeutics ink $100 million deal

Genzyme Corp has inked a $100 million development deal with a New Jersey biopharmaceutical company to develop and sell a new treatment for genetic diseases.

Cambridge, Massachusetts-based Genzyme, which has a genetics laboratory in Santa Fe, said on Thursday it would collaborate with PTC Therapeutics on PTC's drug PTC124. The treatment is being tested in separate mid-stage human clinical trials for a form of muscular dystrophy and cystic fibrosis.

Under the terms of the agreement, PTC will commercialise PTC124 in the US and Canada, and Genzyme will commercialise the treatment in all other countries. Genzyme will make an up-front payment of $100 million to PTC, plus potential milestone and royalty payments. PTC will be financially responsible for one ongoing and three additional clinical trials of PTC124, which is potentially applicable to hundreds of genetic diseases.

PTC is eligible to receive up to $337 million in total milestone payments, as follows - up to $165 million in development and approval milestones, the majority of which are to be paid upon approvals in Genzyme territories; and up to $172 million in sales milestones, contingent upon the achievement of specific sales levels. The sales milestone payments begin when annual net revenues reach $300 million, and increase in increments through revenues of $2.4 billion.

PTC is also eligible to receive tiered double-digit royalties from sales in Genzyme territories.

PTC124 is an orally delivered, investigational new small molecule drug for the treatment of genetic disorders due to nonsense mutations. Nonsense mutations are single-point alterations in the genetic code that prematurely stop the translation process, preventing production of a full-length, functional protein.