Quintiles to Provide Scios $35 million for Commercialization Expenses;
Transaction Provides Compelling Economics for Scios
SUNNYVALE, Calif. and RESEARCH TRIANGLE PARK, N.C., Jan. 11 /PRNewswire/
-- Scios Inc. (Nasdaq: SCIO) and Quintiles Transnational Corp. (Nasdaq: QTRN)
today announced a marketing alliance to commercialize Scios' lead product,
Natrecor(R) (nesiritide) for the treatment of acute decompensated congestive
heart failure (CHF) in the United States. Under the terms of the three and a
half year agreement, Quintiles, through its corporate ventures group,
PharmaBio Development, will provide $35 million in funding for the
commercialization of Natrecor of which $10 million will be paid to Scios
within six months following the launch of Natrecor, immediately following FDA
approval, which is expected to occur during the third quarter of this year.
Innovex, Quintiles' commercialization unit, will deliver a wide range of sales
and marketing solutions for Scios. In addition to providing pre-launch market
development, Innovex will identify, hire, train and deploy a dedicated
cardiology and emergency medicine sales force of approximately 180 to launch
Natrecor.
"The strength of the VMAC trial results and the positive comparison of
Natrecor to IV nitroglycerin, today's standard of care, affords us the
opportunity to commercialize Natrecor ourselves with the help of Innovex which
we believe will have far greater financial potential for our shareholders than
a traditional co-promotion agreement," said Richard B. Brewer, President and
Chief Executive Officer of Scios. "Scios sees two primary advantages in
working with Quintiles. First, we can use Innovex's demonstrated ability to
quickly and effectively build the sales force and marketing infrastructure to
successfully launch Natrecor. Second, Scios will retain more than 80% of the
profits generated on sales of Natrecor through 2007, and Scios will retain
100% thereafter. This is a much better deal for our shareholders than
traditional pharmaceutical co-promotion arrangements we considered under which
Scios would receive just 40-50% of profits."
Dennis Gillings, Chairman and Chief Executive Officer of Quintiles
Transnational Corp. said: "This alliance is an excellent example of how our
corporate ventures group can deliver tailored business solutions. We have
forged a new business model that combines a strategic investment with an
innovative service partnership to bring a promising new medicine to market.
Innovex's expertise in accelerating the success of cardiovascular products and
PharmaBio's financial support can help maximize the impact of Natrecor's
commercialization."
Scios will create a field support team of approximately 30 people.
Twelve of these are scientific affairs managers who will build relationships
with opinion leading cardiologists. Scios will maintain control over the
clinical development for additional indications for Natrecor. It is
anticipated that Innovex will provide services through December 31, 2004, at
which time Scios can convert the Innovex sales force to a Scios sales force.
Quintiles will receive royalties based on a percentage of net sales of
Natrecor from 2003 through 2007. In addition, Quintiles expects to receive
approximately $100 million in payments for providing a fully equipped sales
force over the three and a half year agreement. This amount approximates the
cost that Scios would incur to field a comparably sized sales force on its
own. Scios will grant PharmaBio 700,000 warrants to purchase Scios Common
Stock at a price of $20 per share. The warrants will vest over three years.
Scios has also agreed to make Quintiles' contract research organization a
preferred provider to assist in implementing certain types of clinical trials.
With returns from multiple components, the agreement is expected to be
accretive to Quintiles earnings per share from the beginning of Natrecor's
commercialization.
Eric Topol, MD. Chairman, Department of Cardiology and Co-Director of the
Heart Center, Cleveland Clinic Foundation said, "Natrecor should be one of the
pivotal drugs in the management of patients in the acute phase of heart
failure." Dr. Topol also serves as a director on the Quintiles Transnational
Corp. board.
Additional information about this agreement will be available later today
at the Chase H&Q Healthcare Conference. This event will be webcast live at
http://www.chasehq.com. Once at this website, click on the "19th Annual Healthcare
Conference Webcast" button, then register by entering your name, company and
email address. Then find Scios in the list of companies.
Scios will also hold a telephone conference call with investors Friday,
January 12th at 7:00 am Pacific Time. To access the conference call, dial
800-314-7867. A replay of the call will be available until January 19th at
888-203-1112, confirmation code 542246.
Natrecor
Natrecor is Scios' proprietary recombinant form of B-type natriuretic
peptide (BNP), a naturally occurring hormone in the body that aids healthy
functioning of the heart. BNP is secreted by the ventricles of the heart as
one of the body's natural responses to heart failure. Natrecor appears to
help the body restore salt and water balance, and to improve the function of
the heart. When the heart is unable to pump blood efficiently, BNP is
produced to ease its workload. Natrecor has been developed as a potential
treatment for the short-term management of acute decompensated congestive
heart failure (aCHF), a disease that hospitalizes approximately
one million people in the United States each year.
The VMAC Trial
In the VMAC trial, Natrecor had a statistically significant effect on the
primary endpoint, reducing pulmonary capillary wedge pressure (PCWP) in as
little as 15 minutes, an effect that was sustained for at least 48 hours
without any loss of effectiveness (i.e., without tachyphylaxis or tolerance).
At three hours, patients treated with Natrecor had significant improvement in
PCWP, compared with those patients given standard care plus placebo, and those
patients given standard care plus IV nitroglycerin. At three hours, patients
treated with Natrecor had significant improvement in their breathing, compared
with those patients given placebo. Using primarily a fixed dose, Natrecor
produced a more rapid improvement in hemodynamics than IV nitroglycerin, which
physicians need to titrate to achieve an effective dose.
Significantly fewer adverse events were reported in patients treated with
Natrecor versus IV nitroglycerin. The most common adverse event associated
with Natrecor administration was headache, which occurred significantly less
often than in patients treated with nitroglycerin (9% in the Natrecor patients
versus 20% in the nitroglycerin patients). In the VMAC study, symptomatic
hypotension (i.e., low blood pressure) occurred in patients treated with
Natrecor at about the same rate as in patients treated with IV nitroglycerin
(4% and 5%, respectively) within 24 hours. The study included a broad range
of patients, including those with acute ischemic syndromes.
About Scios
Scios is a biopharmaceutical company developing novel treatments for heart
failure and rheumatoid arthritis. The company's disease-based technology
platform integrates expertise in protein biology with combinatorial and
medicinal chemistry to identify novel targets and rationally design large and
small-molecule compounds to treat cardiovascular and inflammatory diseases,
two of the world's leading unmet medical needs. Additional information on
Scios is available at http://www.sciosinc.com and in the company's various filings
with the Security and Exchange Commission.
About Quintiles Transnational, PharmaBio and Innovex
Quintiles Transnational is the world's leading provider of information,
technology and services to bring new medicines to patients faster and improve
healthcare. Headquartered near Research Triangle Park, North Carolina,
Quintiles employs a global workforce of 19,000 in 38 countries. Quintiles
Transnational is a member of the S&P 500 and Fortune 1000. For more
information visit the company's web site at http://www.quintiles.com.
PharmaBio Development is the corporate ventures group of Quintiles
Transnational Corp. that is dedicated to innovative partnering solutions for
pharmaceutical and biotech companies.
Innovex, the commercialization unit of Quintiles Transnational Corp., is
the world's leading commercial solutions provider that offers sales and
marketing services designed to accelerate the success of pharmaceutical and
biotech products. Across more than 30 therapeutic categories, Innovex has
created 72 contract sales forces, with more than 10,000 representatives to
launch 19 new products over the last five years.
Information in this press release contains "forward-looking statements."
These statements involve risks and uncertainties. These include uncertainties
associated with anticipating the response of the FDA to the results of the
VMAC trial, the timing of regulatory approval of Natrecor, and acceptance by
the medical community of Natrecor as a new therapy for acute decompensated
CHF, as well as other risks detailed from time to time in the reports filed by
Scios with the SEC, including the company's annual report of form 10-K for the
year ended December 31, 1999 and subsequent reports on form 10-Q.
Information in this press release also contains "forward-looking
statements" regarding Quintiles that involve risks and uncertainties including
those that could cause actual results to differ materially, including without
limitation, the risks associated with commercialization and market acceptance
to receive revenues, actual operating performance, the ability to maintain
large client contracts or to enter into new contracts. Additional factors
that could cause actual results to differ materially, including the affect of
recent acquisitions, are discussed in Quintiles Transnational Corp.'s recent
filings with the Securities and Exchange Commission, including but not limited
to its S-3 and S-4 Registration Statements, its Annual Report on Form 10-K,
its Form 8-Ks, and its other periodic reports, including Form 10-Qs.
Statements in this release regarding Scios and Natrecor have been made by
Scios and not Quintiles.
SOURCE Scios Inc.
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Related links:
http://www.sciosinc.com
CONTACT:
Wendy Carhart, Investor Relations of Scios
Inc., 650-619-4038, or carhart@sciosinc.com; or Jim Weiss of
Weisscomm, 415-203-0328, or weisscomm@earthlink.net, for Scios
Inc.; or Pat Grebe, Media Relations, 919-998-2031, or
pat.grebe@quintiles.com, or Greg Connors, Investor Relations,
919-998-2000, or investors.info@quintiles.com, both of Quintiles
Transnational Corp.
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