VC-Backed Astex Signs Deal with J&J

LONDON (Reuters) – Britain's Astex Therapeutics has signed a cancer drug research deal with Johnson & Johnson (JNJ.N: Quote, Profile, Research) potentially worth more than $500 million in milestone payments, it said on Monday.

The privately owned biotech company will receive upfront payments, cash and equity payments and research funding of $37.4 million over two years under the agreement.

The deal grants a worldwide licence to J&J's Janssen unit to develop and commercialize compounds arising from Astex's FGFR inhibitor program and establishes a novel drug discovery program focused on two further cancer drug targets.

Fibroblast Growth Factor Receptor, or FGFR, activates a biochemical pathway that promotes cell growth and is thought to play a role in multiple myeloma, breast, prostate, colon and bladder cancers.

Total payments, excluding royalties, would be worth over $500 million to Astex, assuming one product from each program is successfully commercialized in all territories, Astex said.

The deal is a further vindication of the Cambridge-based company's fragment-based drug discovery platform, known as Pyramid.

Astex already has existing alliances with other major drugmakers, including Novartis AG (NOVN.VX: Quote, Profile, Research), AstraZeneca Plc (AZN.L: Quote, Profile, Research), Bayer AG (BAYG.DE: Quote, Profile, Research) and Boehringer Ingelheim.

Astex was established in 1999 and has raised more than 70 million pounds ($138.4 million) in external finance. Its investors include Abingworth Management, Advent International, Alta Partners, Apax, Bayer, GIMV, HypoVereinsbank, Novartis, Oxford Bioscience Partners and the University of Cambridge.

(Reporting by Ben Hirschler; editing by Sue Thomas)