With IPO near Infinity signs rich pact with MedImmune
Just two weeks before it expects to go public, Infinity Pharmaceuticals Inc. of Cambridge yesterday said it had signed a multi million - dollar deal with Maryland biotechnology company MedImmune Inc. to co develop drugs that could potentially treat several kinds of cancer.
MedImmune will pay Infinity $70 million to share the rights to any drugs that emerge from Infinity's two most advanced development programs. If its experimental drugs succeed and reach the market, total payments to Infinity could reach $500 million.
Since its founding in 2001, Infinity has been a prolific deal maker, signing agreements with large drug companies Amgen Inc. , Johnson & Johnson , and Novartis AG . In most of those deals, Infinity retained full rights to the drugs it was developing, while offering the larger companies access to Infinity's library of potential drug molecules, which are based on a Harvard University technology for creating new chemicals.
In the current deal, however, Infinity is selling half of the rights to its most advanced drugs under development.
Its most advanced experimental drug, which began preliminary human tests last year, focuses on a so-called ``heat-shock protein," a tool cancer cells use to survive. The company hopes it can fight cancers by disabling that survival tool. It is currently testing the drug as treatment for a kind of stomach cancer and a type of blood cancer, and would like to begin its second phase of human trials next year.
In a deal earlier this year, Biogen Idec Inc. of Cambridge paid $150 million for a California company that is also developing drugs to target heat-shock proteins in cancer cells. Other small biotechnology firms are trying to develop heat-shock drugs as well.
In addition to the heat-shock protein drug, the deal Infinity announced yesterday covers drugs designed to attack another cellular process, nicknamed the ``hedgehog pathway." Though they have so far been tested only in animals, such drugs are designed to turn off a cellular signal that fuels cancer cells' growth.
Infinity will split development costs and future revenues with Med Immune, a mid sized biotech company with $1.2 billion in annual sales. MedImmune's chief product is an injectable antibody that fights respiratory disease in babies born prematurely. The company is best known for developing FluMist , a flu vaccine administered as a nasal spray rather than with a needle. Though it attracted wide public attention when approved in 2003, FluMist has been a commercial disappointment, partly because it needs to be kept frozen and is not recommended for children under age 5. The company is developing a new refrigerated version that it hopes will be approved for younger children.
Earlier this year, looking for money to fund further research and testing on humans, Infinity said it would go public in a so-called ``reverse merger" with Discovery Partners International Inc., a small public company in California.
The Discovery Partners shareholder vote on the deal is scheduled for Sept. 12. If approved, the company stock will begin trading as Infinity Pharmaceuticals and will be run by Infinity's executives in Cambridge.
Discovery Partners stock jumped yesterday on news of the MedImmune deal, rising 30 cents to close at $3.52, up more than 9 percent.
MedImmune's stock rose about 1 percent, gaining 27 cents to close at $28.65.
Stephen Heuser can be reached at sheuser@globe.com. 
