Cephalon, Inc. and BioAssets Development Corp. (BDC) have signed an agreement that will provide Cephalon with an option to acquire BDC. Cephalon will pay $30 million upfront and an additional payment if it exercises its option. BDC stockholders could also receive additional future payments related to regulatory and sales milestones. The agreement is subject to customary closing conditions.

BDC, a privately held biopharmaceutical company, is currently conducting a Phase II placebo-controlled proof of concept study with the tumor necrosis factor (TNF) inhibitor, etanercept, epidurally administered to patients with sciatica. Sciatica is a neuropathic inflammatory pain condition that occurs when the sciatic nerve is compressed, injured or irritated. Results are expected to be available in 2H10. BDC has secured rights for use of TNF inhibitors for sciatic pain in patients with intervertebral disk herniation, as well as other spinal disorders.

“BioAssets offers an estate of intellectual property and scientific expertise that will allow us to evaluate our own domain antibody tumor necrosis factor inhibitor, CEP-37247 (formerly known as ART-621), for the treatment of sciatica,” said Frank Baldino, Jr., Ph.D. chairman and chief executive officer of Cephalon. “Combining these two innovations helps fulfill our strategy to address unmet patient needs, while focusing on specialty physicians.”

“Development of an improved non-surgical therapy for sciatica presents a pressing unmet medical need and a potentially significant commercial opportunity,” commented James Gorman, M.D., Ph.D., chief executive officer of BioAssets. “Cephalon combines an innovative TNF inhibitor pipeline with a well established pain therapeutic franchise. I believe these capabilities uniquely position Cephalon to develop and commercialize a novel biologic therapy for these patients.”