Exelixis (EXEL) Enters Major Collaboration With Sanofi-aventis, Will Receive $140M Upfront Payment

May 28, 2009 7:04 AM EDT

Sanofi-aventis (NYSE: SNY) and Exelixis, Inc. (Nasdaq: EXEL) announced a global license agreement for XL147 and XL765 and a broad collaboration for the discovery of inhibitors of phosphoinositide-3 kinase (PI3K) for the treatment of cancer. Activation of the PI3K pathway is a frequent event in human tumors, promoting cell proliferation, survival and resistance to chemotherapy and radiotherapy.

Under the license, sanofi-aventis will have a worldwide exclusive license to XL147 and XL765, which are currently in phase 1 and phase 1b/2 clinical trials, and will have sole responsibility for all subsequent clinical, regulatory, commercial and manufacturing activities. Exelixis will participate in conducting ongoing and potential future clinical trials and manufacturing activities.

Sanofi-aventis will pay Exelixis aggregate upfront cash payments of $140 million under the license and collaboration. Exelixis will also receive guaranteed research funding of $21 million over a three year research term under the collaboration. For the license and the collaboration, Exelixis will be eligible to receive development, regulatory and commercial milestones of over $1 billion in the aggregate, as well as royalties on sales of any products commercialized under the license or collaboration.

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