Red Sky Partners' client, Acetylon Pharmaceuticals, enters into an exclusive strategic collaboration with Celgene Corporation
Red Sky Partners is pleased to announce that our client, Acetylon Pharmaceuticals, has entered into an exclusive strategic collaboration with Celgene Corporation to advance the science of Epigenetics, including an option for Celgene to acquire Acetylon. Xconomy covered the deal on Monday.
Red Sky Partners served as business development advisor to Acetylon Pharmaceuticals for this transaction.
The collaboration will focus on the continued clinical advancement of Acetylon's lead candidate, ACY-1215, an oral first-in-class selective HDAC6 inhibitor being developed for hematological malignancies, a further HDAC6 inhibitor ACY-738 for neurological diseases, an HDAC1/2 inhibitor, and a yet unnamed project, spanning cancer and non-cancer disease indications.
Under the terms of the agreement, Acetylon will receive a $100 million upfront cash payment. In return, Celgene receives an exclusive option to acquire Acetylon at a cash purchase price that will be within a defined value range and based upon future independent valuations of Acetylon. Acetylon will retain control of its drug development programs during the option period. If Celgene exercises its option to acquire Acetylon, an upfront payment determined from the valuation process and subject to a minimum of $500 million will be paid at the time of closing.
Additionally, Acetylon shareholders will be eligible to receive potential future milestone payments for either approvals or additional indications of drugs developed by Acetylon and for accomplishing defined sales targets. If all the milestones are achieved, the additional value accruing to Acetylon shareholders would be $1.1 billion, comprised of $250 million for regulatory milestones and $850 million for sales milestones.
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