ProStrakan: Galapogos receives Novartis milestone payment

ProStrakan has announced that the second milestone relating to the partnership agreement between Galapagos and Novartis relating to the development of antibodies for bone-related diseases has been achieved, with Novartis consequently paying Galapagos a payment of $1 million (0.49 million pounds).

Galapagos will pay $0.75 million of this amount to ProStrakan as a result of an agreement signed by the firms.

The original partnership agreement covering these compounds was signed by Novartis and former ProStrakan subsidiary ProSkelia in September 2006, with this agreement transferred to Galapagos when the drug discovery company purchased ProSkelia three months later.

Under the terms of this latter agreement, milestone and royalty payments from existing partnerships are split, with 75 per cent given to ProStrakan and the remainder staying with Galapagos, while Galapagos keeps all research and development fees.

Dr Wilson Totten, chief executive of ProStrakan, said: “The terms and conditions of the sale of ProSkelia enabled us to retain an interest in future up-side from existing agreements.”

He added that the firm is now seeing receipts from these programmes, with it forecast that this revenue will develop further in the future, bringing ongoing value to the firm.

In March 2007, ProStrakan predicted that the sale of ProSkelia for 45 million euros (30.55 million pounds) could result in annual savings for the the company of nine million pounds.