UPDATE 2-Nabi, Glaxo sign nicotine-addiction vaccine deal
* Nabi to get $40 mln upfront, total potential of $500 mln
* Deal expected to complete in Q1, 2010
* Nabi shares jump 26 pct (Adds details, share movement)
Nov 16 (Reuters) - Nabi Biopharmaceuticals (NABI.O) and a unit of GlaxoSmithKline Plc (GSK.L) signed a licensing agreement for Nabi's experimental vaccine to treat nicotine addiction and the prevention of smoking relapse, the companies said, sending Nabi shares up 26 percent.
Nabi will get $40 million upfront and is eligible to get more than $500 million in option fees and milestones for the vaccine, NicVAX, and follow-on nicotine vaccines, the companies said in a statement.
In return, the British drugmaker will get an option to exclusively in-licence NicVAX on a worldwide basis and a licence to develop follow-on nicotine vaccines.
Nabi will be responsible for the first of two NicVAX late-stage trials, and upon successful completion GlaxoSmithKline Biologicals SA could take responsibility for further development of the vaccine.
The companies expect to complete the deal in the first quarter of 2010.
The vaccine, which received a $10 million grant from the National Institute on Drug Abuse in October, is designed to stimulate the immune system to produce antibodies that bind to nicotine.
In August, Nabi had agreed to the sell PentaStaph, its experimental vaccine for staph infections and related assets, to GlaxoSmithKline for up to $46 million.
The global market for smoking cessation is expected to reach $4.6 billion by 2016, and vaccines could account for $2 billion in sales, according to independent market research firm Datamonitor.
In October, a similar anti-smoking vaccine by Cytos Biotechnology (CYTN.S) and Swiss drugmaker Novartis (NOVN.VX) missed its main goal in a mid-stage study, leading some analysts to question whether it can make it to the market.
Nabi shares rose 26 percent to $4.50 in morning trade Monday on Nasdaq. Glaxo shares were down 4 pence at 1247 pence by 1434 GMT on the London Stock Exchange.
For the alerts, double-click [ID:nWNAB6199] (Reporting by Anand Basu in Bangalore; Editing by Gopakumar Warrier)
