European Deal For Canada's Allelix?

Industry watchers believe that Allelix Biopharmaceuticals of Canada is about to sign a deal with a major European drug company to sell and further develop its osteoporosis drug ALX-11 or human parathyroid hormone (PTH). The alliance is expected to exceed C$20 million ($14.5 million) in an upfront payment and could reach C$100 million in milestone payments when an ongoing research component is included, it was noted. Sandoz and Roche are considered by analysts to be the most likely candidates.

PTH is a naturally-occurring hormone that generates bone; other osteoporosis drugs work only to prevent the disease. While the hormone itself, being a natural human substance, cannot be patented, Allelix has obtained a patent on a high-purity version of the product.

Replaces Previous GW Deal The deal should be signed in about four weeks, depending on when the other company finishes its due diligence, according to one analyst - who wanted to remain unnamed; contracts are said to be being written and his estimate is that they will be signed some time this month. The new partner will provide research payments for improvements on the product's current injectable formulation. This would replace Glaxo Wellcome's Canadian division, which pulled out of its deal with Allelix in December 1994 after deciding the hormone product was not a good strategic fit.