Serono and ZymoGenetics to collaborate in the development of
novel protein and antibody therapeutics
SEATTLE (United States) and GENEVA (Switzerland), Sept. 8
/PRNewswire-FirstCall/ -- ZymoGenetics, Inc. (Nasdaq: ZGEN) and Serono
(virt-x: SEO and NYSE: SRA) today announced their intent to enter into a broad
partnership to research, develop and commercialize novel protein and antibody
therapeutics based on discoveries made by ZymoGenetics.
As part of this alliance:
* Serono will gain access to a large portfolio of ZymoGenetics' genes and
proteins for in-house evaluation and screening, and rights to license
such proteins over the next five years.
* Serono will also have rights over the next five years to license up to
twelve products arising from ZymoGenetics' internal core research
projects. ZymoGenetics will have an option to co-develop and co-
commercialize in the U.S. any products selected by Serono. Until
November 2006, Serono's rights to exclusively license proteins outside
the U.S. will be subordinate to certain existing options of Novo Nordisk
under a separate agreement.
* ZymoGenetics will license to Serono exclusive worldwide rights to
develop and commercialize products based on Fibroblast Growth Factor 18
(FGF-18) and the Interleukin 22 Receptor (IL-22R). In addition, the
companies will co-develop Interleukin 31 (IL-31).
Expected payments to ZymoGenetics include:
* A payment of $20 million in exchange for the rights to license proteins
over the next five years.
* The purchase of $50 million of ZymoGenetics' common stock.
* An equal share of profits from the co-commercialization of products in
the U.S. for which ZymoGenetics has co-funded development.
* For every protein exclusively licensed or co-developed by Serono, up-
front fees as well as potential milestone payments related to
development progress, regulatory submissions and approvals.
* Royalty payments on product sales outside the U.S. and, to the extent
ZymoGenetics elects not to co-develop products, on product sales in the
U.S.
The terms of this agreement are subject to review by the United States
Federal Trade Commission and Department of Justice, under the provisions of
Section 7A of the Clayton Act, 15 U.S.C. Section 18a, as added by the Hart-
Scott-Rodino Antitrust Improvements Act of 1976.
"We are enthusiastic about building this alliance with Serono," said Bruce
L.A. Carter, Ph.D., President and Chief Executive Officer of ZymoGenetics.
"Maximizing the value of our broad pipeline requires the effort of a proven
research, development and commercial enterprise. Serono has not only
demonstrated its strengths in these areas, but also has proven an effective
partner in our collaborative development of TACI-Ig. The combination of our
resources should work to create value for both companies over the years
ahead."
"We are very pleased to expand our fruitful collaboration with
ZymoGenetics," said Ernesto Bertarelli, Chief Executive Officer of Serono. "By
combining ZymoGenetics' strong pipeline of therapeutic protein candidates with
our research and development capabilities, we are well positioned to bring to
the market further innovative treatments for medical conditions with
significant unmet needs."
Three license agreements for FGF-18, IL-22R and IL-31 will be entered into
as part of this alliance. Serono will have worldwide exclusive rights for FGF-
18 and IL-22R, which may be useful for repairing cartilage damaged by
osteoarthritis or physical injury, and psoriasis, respectively. ZymoGenetics
will retain co-development and co-commercialization rights in the U.S. for IL-
31, which could be useful in treating inflammatory conditions such as asthma,
psoriasis and inflammatory bowel disease. In addition to the $20 million
payment mentioned above, ZymoGenetics will receive initial license fees
totaling $11.25 million related to these three projects. Total upfront and
milestone payments under these licenses could exceed $100 million.
Serono reiterates its guidance for 2004 with an increase in total revenues
of at least 12% and an increase in net income of at least 20% in local
currencies.
ZymoGenetics will conduct a conference call/webcast in conjunction with
today's release at 8:30 A.M. ET on Wednesday, September 8, 2004. The webcast
will include a slide presentation. Members of the news media, investors and
the general public are invited to access a live broadcast of the conference
call via the ZymoGenetics website at
http://www.zymogenetics.com/ir/events.php or through http://www.vcall.com. The
event will be archived. The telephone replay will be available until 11:59 PM
Pacific Time on September 14, 2004. The webcast will be available for replay
until 11:59 PM Pacific Time on October 7, 2004.
Phone numbers and access codes for the conference call are as follows:
Live Call- Domestic: 800-370-0740 International: 973-409-9259
An operator will answer calls for the live event.
Archived Call- Domestic 877-519-4471 International: 973-341-3080
Replay Passcodes (required for playback):
Account #: 1628Conference ID #: 5131574
About FGF-18
Fibroblast growth factor-18 (FGF-18) plays an important role during
skeletal development and appears to be a trophic factor for chondrocytes, the
cells that produce cartilage of the joint surfaces, in mammals. ZymoGenetics
has previously shown that FGF-18 and the genes for two of its receptors are
expressed by chondrocytes in adult human articular cartilage. Addition of FGF-
18 to the culture medium of these cells increased both their proliferation and
their production of extracellular matrix. Similar changes in chondrocyte
proliferation and matrix deposition were observed at a number of sites
following local or systemic delivery of FGF-18. These data suggest that FGF-18
may be useful for healing cartilage damaged by injury or disease.
About IL-22R
The IL-10 family cytokines IL-20 and IL-22 are pro-inflammatory and each
can signal via the receptor subunit IL-22R alpha. Considerable evidence
supports the inflammatory roles of IL-20 and IL-22 in psoriasis including
their elevated expression in psoriatic lesions, transgenic mice phenotypes,
genetic association data and animal pharmacology. Expression of the receptor
subunit IL-22R alpha is also elevated in psoriatic lesions. Current work is
directed towards choosing the most suitable antagonist for evaluation in the
treatment of psoriasis. Such antagonists may also have use in other instances
of impaired epithelial barrier function, such as in inflammatory bowel
disease.
About IL-31
ZymoGenetics researchers discovered Interleukin 31 (IL-31) using the
Company's genomics-based discovery platform. Current in vitro and in vivo data
suggest that IL-31 may affect cellular infiltration and inflammation. Analysis
of IL-31 and IL-31 receptor levels in human and murine disease tissues
suggests that expression of IL-31, and/or its receptor, is significantly
increased in the settings of inflammatory bowel disease, asthma and psoriasis.
Further evidence suggests a potential role of IL-31 in the development of
atopic dermatitis. A paper by ZymoGenetics scientists published in the July
2004 issue of the journal Nature Immunology characterizes IL-31, illustrates
the hypothesized role of IL-31 in atopic dermatitis and respiratory disease,
and suggests directions for future investigation of this cytokine and its role
in human diseases.
About ZymoGenetics
ZymoGenetics is a biopharmaceutical company focused on the discovery,
development and commercialization of therapeutic proteins for the prevention
or treatment of human diseases. The Company is developing a diverse pipeline
of potential proprietary product candidates that are moving into and through
clinical development. These span a wide array of clinical opportunities that
include bleeding, autoimmune diseases and cancer. ZymoGenetics intends to
commercialize these product candidates through internal development,
collaborations with partners, and out-licensing of patents from its extensive
patent portfolio. For further information, visit http://www.zymogenetics.com.
About Serono
Serono is a global biotechnology leader. The Company has eight
biotechnology products, Rebif(R), Gonal-F(R), Luveris(R),
Ovidrel(R)/Ovitrelle(R), Serostim(R), Saizen(R), Zorbtive(TM) and Raptiva(R)
(Luveris(R) is not approved in the USA). In addition to being the world leader
in reproductive health, Serono has strong market positions in neurology,
metabolism and growth and has recently entered the psoriasis area. The
Company's research programs are focused on growing these businesses and on
establishing new therapeutic areas. Currently, there are approximately 30
ongoing development projects.
In 2003, Serono achieved worldwide revenues of US$2,018.6 million, and a
net income of US$390.0 million, making it the third largest biotech company in
the world. Its products are sold in over 90 countries. Bearer shares of Serono
S.A., the holding company, are traded on the virt-x (SEO) and its American
Depositary Shares are traded on the New York Stock Exchange (SRA).
Background material
For free B-roll, video and other content about Serono, please visit the
Serono Media Center http://www.thenewsmarket.com/Serono. You can download
print-quality images and receive broadcast-standard video digitally or by tape
from this site. Registration and video is free to the media.
ZymoGenetics forward-looking statements
This press release contains "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are based on the current intent and expectations of
the management of ZymoGenetics. These statements are not guarantees of future
performance and involve risks and uncertainties that are difficult to predict.
ZymoGenetics' actual results and the timing and outcome of events may differ
materially from those expressed in or implied by the forward-looking
statements because of risks associated with our unproven discovery strategy,
preclinical and clinical development, regulatory oversight, intellectual
property claims and litigation and other risks detailed in ZymoGenetics'
public filings with the Securities and Exchange Commission, including
ZymoGenetics' Annual Report on Form 10-K for the year ended December 31, 2003.
Except as required by law, ZymoGenetics undertakes no obligation to update any
forward-looking or other statements in this press release, whether as a result
of new information, future events or otherwise.
Serono forward-looking statements
Some of the statements in this press release are forward looking. Such
statements are inherently subject to known and unknown risks, uncertainties
and other factors that may cause actual results, performance or achievements
of Serono S.A. and affiliates to be materially different from those expected
or anticipated in the forward-looking statements. Forward-looking statements
are based on Serono's current expectations and assumptions, which may be
affected by a number of factors, including those discussed in this press
release and more fully described in Serono's Annual Report on Form 20-F filed
with the U.S. Securities and Exchange Commission on March 25, 2004. These
factors include any failure or delay in Serono's ability to develop new
products, any failure to receive anticipated regulatory approvals, any
problems in commercializing current products as a result of competition or
other factors, our ability to obtain reimbursement coverage for our products,
and government regulations limiting our ability to sell our products. Serono
has no responsibility to update the forward-looking statements contained in
this press release to reflect events or circumstances occurring after the date
of this press release.
SOURCE Serono
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Related links:
http://www.zymogenetics.com
http://www.thenewsmarket.com/Serono
CONTACT:
Investor Relations, John Calhoun, MD, MBA,
Director, Corporate Communications & Investor Relations,
+1-206-442-6744, or Media Relations, Susan W. Specht, MBA
Corporate Communications Manager, +1-206-442-6592, both of
ZymoGenetics; or Serono, Corporate Media Relations: +41 22 739 36
00, Fax: +41 22 739 30 85, or Corporate Investor Relations: +41
22 739 36 01, Fax: +41 22 739 30 22, or Media Relations, USA:
+1-781-681-2486, Fax: +1-781-681-2935, or Investor Relations,
USA: +1-781-681-2552, or Fax: +1-781-681-2912
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