Irish drug development company Merrion Pharmaceuticals has signed a multi-million euro deal with Novo Nordisk to develop oral diabetes products.
Under the agreement Novo Nordisk will pay Merrion for the cost of its development work, provide Eur 45.7 million ($58 million) in staged payments and provide the Dublin-based company with an undisclosed stake in the royalties on sales of any product brought to market.
Merrion has developed technologies that allow for injection-delivered drugs to be delivered and absorbed in oral form.
John Lynch, Merrion chief executive said, oral insulin is ″the Holy Grail of the drug delivery business″, adding no other major pharmaceutical firm has a similar product in development.
He said Merrion′s technology was particularly relevant for biopharmaceuticals because most were given by injection: ″To give them in tablet form can really transform the use of the drug. It changes the economics of a drug″.
Novo Nordisk is one of the largest suppliers of diabetes medicines and the collaboration with Merrion will focus on its new generation peptide and protein-based insulin drugs.
Mr Lynch said he was delighted with the collaboration, the biggest in the listed company′s four-year history. ″Novo Nordisk are the world′s leader in this diabetes field . . . and they are very good at developing these new insulin products″.
As a result of the deal Merrion is going to increase its full-time staff of 26 people by ″around 25 per cent″.
The main challenge is to ensure the correct dosage is delivered through an oral insulin product and clinical trials are expected to begin next year.
Mr Lynch declined to comment on the likely development time but industry sources suggested such a project would require 3 to 5 years.
Merrion was formed in 2004 to commercialise a number of technologies bought by Growcorp Group Ltd from Elan. It is based in biotechnology institute on the Trinity College Dublin campus.
Fintan Maher, Growcorp chief executive said ″we are delighted with Merrions continued progress, it validates our investment strategy and ability to identify large scale investment opportunities. We actually found it difficult to attract co-investors in Ireland at the time we made the investment as other private and institutional investors seemed only to have eyes for property or did not have the expertise to understand the investment proposition. Growcorp continues to offer investment opportunities to investors, we see many other interesting investments in the Irish market which are capable of becoming international″.
A note to investors NCB Stockbrokers said the deal was ″potentially a large step change for Merrion″ as it validated the company's drug delivery technology and provided the company with cash for its research and development.
