Exelixis amends collaboration with GlaxoSmithKline

Exelixis has amended the terms of its collaboration with GlaxoSmithKline (GSK).

Under the terms of the original agreement, established in October 2002, a four-month option period began in October 2004 for GSK to elect whether or not to expand the collaboration, with the resultant amended collaboration providing accelerated milestone payments to Exelixis and allowing third-party development and funding of certain programmes.

Under the amended agreement, Exelixis will continue to work on 12 programmes and GSK will retain exclusive rights to 32 specified targets. Depending on the timing of GSK's compound selection, they will pay proof-of-concept milestones up to approximately US$275m for three compounds, with Exelixis also receiving additional development-related milestones and royalties on product sales and holding certain co-promotion rights to products in North America.

Exelixis will also retain rights to all collaboration compounds not encompassed by the 12 programmes selected by GSK and may work on any collaboration targets with the exception of the 32 targets subject to GSK's exclusivity.

Other milestone payments will include $30m upon the filing of three additional INDs from the compounds XL880, XL184, XL820 and XL844, by the end of 2005, or upon successful completion in 2005 of a phase I trial for one of these four compounds, and an additional $5m upon achieving specified progress with respect to certain other candidates.

'We have filed four Investigational New Drug (IND) applications and generated six development candidates in just over two years,' said Dr George A. Scangos, president and ceo of Exelixis. 'The new near-term milestones, together with the flexibility to advance programmes using alternative financing vehicles, will allow Exelixis to quickly progress multiple compounds through clinical development.'

GSK will also provide research funding of $47.5m over the remaining term of the collaboration.