GSK Enters Drug Development Pacts

GlaxoSmithKline has formed two drug discovery partnerships and named a successor to its CEO, Jean-Pierre Garnier.

GSK and Anacor Pharmaceuticals are teaming up to discover, develop, and commercialize viral and bacterial disease therapies based on Anacor's boron-based chemistry platform. Under the agreement, Anacor will grant GSK options to select product candidates directed at up to four discovery targets with the potential for at least eight product options.

Anacor will receive a $12 million up-front payment and a $10 million equity financing commitment from GSK. Anacor can potentially receive milestone payments ranging as high as $331 million for each product candidate. If GSK exercises its option at the proof-of-concept stage, Anacor will receive double-digit royalties on any commercialized drug.

GSK also signed an agreement with Synta Pharmaceuticals for the development and commercialization of STA-4783, Synta's metastatic melanoma treatment, outside the U.S. Synta will receive an up-front cash payment of $80 million. It will be eligible to receive milestone payments of up to $135 million for events leading to approval of STA-4783 in metastatic melanoma and up to an additional $450 million in milestones related to other indications.

Synta will receive double-digit royalties on commercial sales. GSK may also purchase up to $45 million of Synta's common stock.

Meanwhile, GSK has appointed Andrew Witty, currently president of the company's European pharmaceuticals business, as the designated successor to CEO Garnier following Garnier's scheduled retirement in May 2008.