MERRION Pharmaceuticals, the Irish drug maker listed on the IEX share index, has formed an alliance with the world’s largest insulin maker, Novo Nordisk, in a deal that will see the diabetes specialists take a 1.8 per cent stake in Merrion.
The investment, which is worth almost €1 million, forms part of a new venture between the two companies on oral medicines for diabetes.
Novo, based in Denmark, will buy 300,000 new shares at a price of €3 each, Merrion said.
Under the terms of the deal, Merrion could get as much as $58 million when the first product reaches the market, as well as royalties on sales. The companies will focus on manufacturing a pill version of a Novo therapy that stimulates insulin production.
The class of drugs is among the most promising new medications to treat diabetes.
Novo’s most advanced product in the class, liraglutide, is under review by US drug regulators.
The drugs imitate a naturally occurring GLP-1 hormone and help patients feel full after a meal. As yet, they must be injected, limiting their convenience for patients.
The new partnership will use Merrion’s oral GIPET technology to improve absorption of the compounds that are normally difficult for the body to use. Merrion will receive additional milestone payments for any additional products developed under the agreement.
Yesterday’s contract is the second between the two companies, following a $58-million deal in November. Merrion chief executive John Lynch said the deal outlined the potential for a long-term partnership between the two companies. – (Additional reporting, Bloomberg)
