Baxter Ventures, the venture arm of Baxter International Inc. BAX, along with Mayo Clinic and Velocity Pharmaceutical Development, LLC recently announced the formation of Vitesse Biologics, LLC – a company structured to advance therapeutic innovation.
Initiated by Baxter Ventures, Vitesse is a unique collaboration model designed to focus on the development of antibody and protein-based therapeutics in areas of immunology, hematology and oncology. With the establishment of this company, the partners intend to develop innovative treatments to address unmet patient needs.
The collaboration model represents a new method of drug development, in which each associate will provide its recognized expertise to enhance the target selection, target optimization, expression and product development process to advance promising therapies.
Notably, Baxter BioScience will provide global commercialization, antibody and protein development and manufacturing capabilities; Mayo Clinic researchers will execute the Phase I clinical trials; while Velocity Pharmaceutical will be responsible for target identification, selection of early stage drug candidates and leading the design and execution of pre-clinical and clinical protocols.
The Vitesse business will form part of Baxter BioScience, which is soon to be established as a separate, publicly traded company – Baxalta Inc. Following the spin-off of Baxter BioScience as Baxalta, anticipated to take place by mid-2015, the Vitesse relationship will be managed by Baxalta Ventures, for the new company.
We believe that the formation of Vitesse will drive Baxalta’s research and development focus and enhance its commercial portfolio. Since Baxter BioScience will be involved in the early-stages of development for all products identified by Vitesse, it will enable Baxter to serve as a hands-on partner in the pursuit of innovative treatments. Moreover, Baxter will have an exclusive option to acquire each such product following the completion of the applicable Phase I trials.
Last month, executives from Baxter BioScience revealed that Baxalta’s focus will be on three core therapeutic areas: hematology, immunology and oncology, which strongly align with Vitesse’s therapeutic focus.
We also note that Baxalta has implemented a new patient-centric R&D model and expects to launch 20 products that will contribute more than $2.5 billion in annual sales by 2020. The company plans to further augment its pipeline through external partnerships and strategic acquisitions. We believe that such a strategy will significantly enhance the company’s scale of operations, drive its top line and boost profits in the long run.
Stocks to Consider
Currently, Baxter carries a Zacks Rank #3 (Hold). Better-ranked stocks in the medical products industry include Bio-Rad Laboratories Inc. BIO, Hospira Inc. HSP and Vascular Solutions Inc. VASC. All these stocks sport a Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Be the first to comment