* Glaxo to develop drugs using Isis's antisense technology
* Isis to receive $35 mln as upfront payment
* Isis shares up 11 percent
(Adds analyst comment, updates share movement)
By Shailesh Kuber
BANGALORE, March 31 Isis Pharmaceuticals Inc
ISIS.O said it entered into an agreement worth up to $1.5
billion with GlaxoSmithKline (GSK.N) (GSK.L) to develop
treatments for infectious diseases, using its antisense drug
Shares of Isis rose as much as 11 percent to $11.43
Wednesday on Nasdaq. They later pared some gains and were
trading up 9 percent at $11.20.
"The deal with GlaxoSmithKline shall validate Isis'
antisense platform and helps provide visibility to what is a
very deep pipeline," Barclays Capital analyst Jim Birchenough
"It provides further funding to bring antisense
opportunities to fruition," added Birchenough, who maintained
his "overweight" rating and price target of $17 on Isis stock.
Under the deal, Isis will receive an upfront payment of $35
million from Glaxo and is eligible to receive on average up to
$20 million per program up to mid-stage proof of concept (PoC)
as milestone payments.
Also, Isis will be eligible to receive license fees and
milestone payments of about $1.5 billion.
Glaxo will have the option to license compounds, and will
be responsible for further development and marketing, while
Isis will receive up to double-digit royalties on sales from
any product that is successfully commercialized, the company
RNA-targeted therapeutics, or antisense therapies, aim to
interfere at the genetic level to prevent rogue proteins from
(Reporting by Anand Basu and Shailesh Kuber in Bangalore;
Editing by Vinu Pilakkott, Anne Pallivathuckal)