Cerulean Pharma Inc (NASDAQ:CERU) has recently initiated a collaboration with Novartis, to develop NDC product candidates, making use of proprietary technologies from both companies. CERU stated that it would be making use of proprietary compounds from Novartis and its own Dynamic Tumor Targeting technology, to address up to five targets. Under the agreement, Cerulean would be responsible for the creation of NDC candidates, with further development being undertaken by Novartis.
The terms of agreement, between the two companies, also entitle CERU to receive an upfront payment of $5 million, coupled with funding for five full-time equivalents. Moreover, the company would also receive certain milestones for preclinical, clinical, regulatory and sales milestones. This would also be accompanied by royalties from sales of each NDC product, following regulatory approval.
The CEO of Cerulean, Christopher D.T. Guiffre, pointed out that Novartis was a renowned drug development company and the current collaboration was a validation of CERU’s technology platform. He also expressed his pleasure at being able to contribute to the product pipeline of Novartis and excitement at Novartis’ willingness to add NDCs to its drug discovery and development efforts. Mr. Guiffre also expressed his confidence in the partnership’s potential to accelerate their efforts towards providing safe and effective options to cancer patients.
In addition to receiving funds for its drug development programs from Novartis, the company has also successfully secured $20 million in funding, through a stock purchase agreement, with Aspire Capital Fund LLC. As per the agreement, Aspire was sold a total of 800,000 shares of CERU’s common stock, at $1.25 per share. Moreover, Cerulean would also need to sell $19 million worth of its common stock, to Aspire, over the next 2-years. It should be noted here that this sale would be conducted at a price, determined through the share value at the time of purchase. No warrants have been issued, in connection with this agreement and CERU holds the rights to terminate the agreement, without additional costs.
Cerulean Pharma Inc (NASDAQ:CERU) lost 3.67% of its share value, during the October 20 trading session, to close at $0.915 per share. The stock had a trade volume of 1.78 million.