TEL AVIV Feb 26 Israel's Clal Biotechnology Industries said its subsidiary Andromeda Biotech is in talks to be sold to an American pharmaceutical company for a price that could reach hundreds of millions of dollars.
Andromeda signed a non-binding memorandum of understanding to be sold to the unnamed firm, Clal, which owns 96 percent of Andromeda, said in a statement to the Tel Aviv Stock Exchange on Wednesday. Clal said the talks are at an early stage.
The price will include an upfront payment and future milestone payments related to the development and sales of DiaPep277, the Type I diabetes treatment Andromeda is developing. The payment will also include double-digit royalties from future sales.
Two days ago Teva Pharmaceutical Industries, the world's biggest generic drugmaker, transferred its rights in DiaPep277 and all of its shares in Andromeda to Andromeda for $72 million.
DiaPep277 is in advanced phase 3 trials in more than 100 medical centres in North America, Europe, Israel and Argentina. The main goal of the study is to preserve the ability of the pancreas to secrete insulin in patients who receive treatment with DiaPep277.
Clal Biotechnology is a subsidiary of Clal Industries. (Reporting by Tova Cohen)