Roche RHHBY announced that it has entered into a license agreement with Upsher-Smith Laboratories, Inc. for the development of Vascular Adhesion Protein 1 (VAP-1), a novel oral small molecule inhibitor.
The inhibitor, currently in phase II, is being developed for the treatment of inflammatory diseases.
As per the terms of the agreement, Roche will own the worldwide license to develop and commercialize VAP-1. The company will collaborate with Proximagen Ltd, the wholly-owned UK subsidiary of Upsher-Smith, for conducting additional phase II studies to further evaluate the therapeutic potential of the VAP-1 inhibitor.
Roche will be responsible for late-stage development and worldwide commercialization of VAP-1 if results of the phase II studies are favorable. On the other hand, Proximagen will receive an upfront payment, along with other milestone payments. It will also receive tiered royalties on net sales of a potential future product containing the molecule.
Roche has a strong presence in the oncology market. In particular, the company dominates the breast cancer space with strong demand for its HER2 franchise drugs. The HER2 franchise includes Herceptin, Perjeta and Kadcyla.
We are encouraged by Roche’s efforts to develop its portfolio beyond oncology into immunology, ophthalmology, infectious diseases, and neuroscience.
Addition of new drugs to Roche’s portfolio should help the company partially offset the impact of the loss of revenues due to generic competition for Xeloda and Pegasys.
Meanwhile, apart from providing therapeutic products and services for diverse medical needs, Roche focuses on innovative diagnostic solutions for early detection and treatment of diseases.
Roche currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the healthcare sector include AstraZeneca PLC AZN, Eli Lilly and Company LLY and Biodel Inc. BIOD. AstraZeneca sports a Zacks Rank #1 (Strong Buy), while Eli Lilly and Biodel carry a Zacks Rank #2 (Buy).
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