(BioSpace) Shares of Prothena Corporation plc have shot up more than 18 percent in premarket trading this morning after the company forged a collaboration with pharma giant Celgene to develop new therapies for a broad range of neurodegenerative diseases, including Alzheimer’s and ALS.
Celgene will pay Prothena $150 million in upfront money with the promise of future regulatory and commercial milestone payments. According to a filing with the U.S. Securities and Exchange Commission Prothena is eligible to receive up to $562.5 million in milestone payments per program. When tiered royalties are factored in, the company could earn more than $2 billion if each program is commercialized.
Part of that initial payment includes Celgene’s acquisition of 1.2 million shares of Prothena stock at $42.57 per share.
The collaboration between Celgene and Ireland-based Prothena will focus on three proteins implicated in the pathogenesis of several neurodegenerative diseases, including tau, one of the key proteins implicated in Alzheimer’s disease. Prothena said it has identified antibodies that target novel epitopes on the tau protein that have the ability to “block misfolded tau from binding to cells.” That will inhibit cell-to-cell transmission and prevent “downstream functional toxic effects.”
Tau has become an increasingly important focus in Alzheimer’s research following multiple failures to target amyloid-beta. Multiple companies have failed to develop antibodies that target the amyloid-beta, including a recent failure of Merck’s BACE inhibitor verubecestat (MK-8931).
The other proteins are TDP-43, a protein implicated in diseases including amytrophic lateral sclerosis (ALS), as well as an undisclosed target.
Prothena Chief Executive Officer Gene Kinney said his company is excited to be working with Celgene, which has “deep expertise in targeting critical biological pathways involved in protein homeostasis.”
The deal with Prothena comes only a few weeks after the company tied up a developmental deal with Vividion Therapeutics that includes a focus on developing small molecules to treat neurodegenerative disease.
As part of the deal with Prothena, Celgene will have the right to license clinical candidates in the United States and expand those rights to a global setting following the completion of Phase I testing.
Richard Hargreaves, head of neuroscience and imaging at Celgene, touted Prothena’s “legacy of innovation” in neuroscience. He said Celgene’s collaboration with Prothena leverages the expertise of both companies to target proteins that are the underlying cause of many neurodegenerative and orphan diseases.
“The programs we have chosen to collaborate on have the potential to provide foundational assets from which we can build new therapeutic approaches to these currently untreatable neurological disorders,” Hargreaves said in a statement.
Prothena has a pipeline of antibody candidates that target a number of indications, including AL amyloidosis, Parkinson’s disease and other related synucleinopathies and ATTR amyloidosis.