PA-Supported Firm Secures $345 Million Worldwide Licensing Agreement
Partnership to Help Commercialize ALS Treatments, Create Jobs and Spur Economic Expansion
HARRISBURG, Pa., Aug. 19 /PRNewswire-USNewswire/ -- A Pittsburgh start-up company that received an early investment from one of Pennsylvania's most dynamic resources has entered into an exclusive licensing agreement to help find the cure for Lou Gehrig's disease, or ALS, Department of Community and Economic Development Secretary Austin Burke announced today.
Knopp Neurosciences -- a portfolio company of Innovation Works, the Ben Franklin Technology Partner of southwestern Pennsylvania -- entered into a $345 million worldwide licensing agreement with Biogen Idec, making it one of the largest pharmaceutical deals in the nation this year.
Under the deal, the two companies will work collaboratively to develop Knopp's experimental drug treatment, dexpramipexole.
"The Rendell administration has been touting the importance of providing early-stage capital to promising Pennsylvania companies since its beginning," Burke said. "Without this vital financing at crucial stages in a new company's life, many fail. Under Governor Rendell's leadership, Innovation Works and other Ben Franklin Technology Partners are providing resources that help promising young companies compete and succeed.
"This agreement is a testament to that fact and we are proud to have had a hand in such an important endeavor. Knopp's discoveries could have the potential to reach far beyond Pittsburgh and the state."
Innovation Works invested $300,000 in Knopp in 2006 -- making it Knopp's first and only early-stage investor -- to help the company complete its Food and Drug Administration requirements, finalize research contracts and initiate operations. This initial investment also helped the company more than double its employment, growing from seven to 16 well-paying jobs.
With the Biogen Idec agreement, Knopp operations will remain in Pittsburgh and the company is expected to expand.
Michael Bozik, M.D., president and CEO of Knopp, today said his company's new deal "affirms the value of state-supported biotech investments."
Under the agreement, Biogen Idec will lead the development of the drug and its potential commercialization in global markets. Biogen Idec will purchase $60 million of Knopp stock; provide an upfront payment of $20 million; make additional payments of up to $256 million based on development and sales; and pay tiered, double-digit royalties to Knopp on worldwide sales.
"We are thrilled to see Knopp reach this significant milestone," Rich Lunak, president and CEO of Innovation Works said. "First, it brings us closer to finding a solution to debilitating diseases. But second, growth among early-stage companies has a tremendous ripple effect throughout the community by bringing in outside capital, creating job growth, and -- in companies like Knopp -- developing significant technological breakthroughs that can improve society."
Positioned strategically throughout Pennsylvania, the Ben Franklin Technology Partners, with regional headquarters in the Lehigh Valley, Philadelphia, Pittsburgh and State College, supports and executes the commonwealth's technology agenda, builds on regional strengths, capitalizes on new opportunities and new technologies, and addresses the specific needs of Pennsylvania's diverse communities.
A recent study found that for every dollar of state funds the technology partners invested, those projects returned three-and-a-half times more in tax receipts to the commonwealth's coffers. These projects also increased the state's gross domestic product by $9.3 billion and accounted for the equivalent of 32,800 jobs over a five year period.
For more information about the Ben Franklin Technology Partners or other innovative DCED programs that spur the advancement of technology innovation, visit www.newPA.com or call 1-866-466-3972.
Media contact: Jamie Yates, 717-783-1132
SOURCE Pennsylvania Department of Community & Economic Development