Pharmion signs $25M HDAC license accord with MethlyGene

US drugmakers MethylGene and Pharmion Corp have entered a license and collaboration agreement for the R&D and commercialization of the former's histone deacetylase inhibitors in the USA, Europe, the Middle East and certain other markets. The deal includes MGCD0103, MethylGene's lead HDAC inhibitor, as well as its pipeline of second-generation HDAC inhibitor compounds for oncology indications.

Under the terms of the agreement, MethylGene will receive up front payments totaling $25.0 million, consisting of a $20.0 million license fee and a $5.0 million equity investment in its common shares to be purchased at a subscription price of $3.125 each which represents a 25% premium over the market closing price on January 27, resulting in Pharmion's 7.8% ownership in MethylGene.

MethylGene noted that Pharmion's milestone payments for MGCD0103 could reach $145.0 million, based on the achievement of significant development, regulatory and sales goals, with the nearest-term milestone of $4.0 million to be paid upon enrollment of the first patient in a Phase II trial. Furthermore, up to $100.0 million may be paid for each additional HDAC inhibitor.