Peptech sells UK researcher for $178m
Kirsty Simpson
December 11, 2006
SYDNEY biotechnology group Peptech is poised to pocket $178 million after the sale of one of its major assets, a one-third stake in British antibodies researcher Domantis, to multinational GlaxoSmithKline.
GSK will pay a total of $575 million for Domantis, in a deal that was unveiled late on Friday night and is expected to be completed in January.
Peptech chairman Mel Bridges said the company would realise a gain of $138.2 million for its stake, after investing $40 million in the privately held British company in three tranches between 2001 and late 2005.
Other joint venture partners include a Mitsubishi subsidiary and Europe's largest biotech, Novo Nordisk.
"This is an outstanding result, particularly given the largely pre- clinical stage of Domantis's development pipeline," Mr Bridges said.
The windfall will be set aside for acquisitions and clinical trials. One of Peptech's most promising auto-immune drugs, PN0621 (supplied by Domantis) enters costly stage one clinical trials next year.
Peptech recently unveiled an aggressive growth strategy, revolving around rising drug development spending, and further acquisitions - there were two small purchases last year.
Chief executive Dr John Kiplin said the company also remained open to mergers, and had spoken to more than a hundred companies during the course of its recent buying spree.
Peptech considered its Domantis investment one of its five major assets, but Dr Kiplin said the sale would not affect its commercial collaborative relationship with Domantis, allowing Peptech to select two further therapeutic targets for Domantis to research.
Peptide shares closed on Friday at $1.30.