UPDATE 1-Bellus to sell amyloidosis drug rights for $10 mln

* Says sale to Celtic Therapeutics

* Celtic to fund clinical study, regulatory approval

* Celtic to hold auction for commercialization rights

* Bellus shares shoot up as much as 47 pct

April 29 (Reuters) - Bellus Health Inc BLU.TO said Celtic Therapeutics agreed to buy the rights to its drug candidate to treat a potentially life-threatening condition for upfront payments of $10 million, sending its shares up as much as 47 percent Thursday afternoon.

Celtic will acquire and license the global rights to the drug Kiacta and fund its clinical study and other development activities, estimated at $20 million, the companies said in a joint statement.

Celtic will also complete all the requirements for the late-stage product candidate’s regulatory approval and hold an auction for its commercialization rights.

The proceeds of the auction would be split equally among both companies.

AA amyloidosis, a fatal condition which affects about 50,000 people across the United States, Europe and Japan, occurs in patients with severe inflammatory conditions, most commonly brought on by rheumatoid arthritis, Bellus said.

Shares of the Laval, Quebec-based Bellus, which have lost 23 percent of their value in the last three months, rose by as much as 8 Canadian cents, before paring some gains to trade up at 21 Canadian cents on the Toronto Stock Exchange. (Reporting by Abhiram Nandakumar in Bangalore; Editing by Aradhana Aravindan)