Covagen and Tanabe Research Laboratories Expand Strategic Research Collaboration for Development of Bispecific FynomAbs

ZURICH-SCHLIEREN, Switzerland and SAN DIEGO, Nov. 21, 2013 /PRNewswire/ -- Covagen and Tanabe Research Laboratories U.S.A, Inc. (TRL), a fully owned subsidiary of Mitsubishi Tanabe Pharma Corporation (MTPC), today announced that they expanded their strategic research collaboration. MTPC and TRL have nominated a first bispecific FynomAb for formal preclinical development which triggered an undisclosed milestone payment. MTPC and TRL also exercised an option for a second bispecific FynomAb program based on the parties' research and licensing agreement signed in October 2012. Under the agreement, Covagen will use its proprietary Fynomer-antibody platform to generate bispecific antibodies (FynomAbs) against a second target pair selected by TRL and MTPC.

"We believe Covagen's FynomAb platform is a source of innovative bispecific antibodies with excellent biophysical properties that will allow more effective treatment of inflammatory and oncologic diseases," said Roland Newman, Ph.D., chief scientific officer of TRL. "We look forward to continuing our cooperative work with the Covagen team as we advance the first FynomAb into preclinical development and look towards discovery of the second FynomAb as part of this expanded collaboration."

Through payment of an undisclosed option fee, MTPC secured global, exclusive rights to bispecific FynomAbs against a second target pair in oncology. Under the agreement, MTPC will fund all research activities and be solely responsible for the development, manufacturing and global commercialization activities. Upon achievement of certain research, development and regulatory milestones, Covagen is entitled to receive payments of up to €108.25 million for the second program as well as tiered royalties on worldwide net sales of products resulting from the collaboration.

"The expansion of our collaboration with MTPC and TRL provides substantial validation of Covagen's bispecific FynomAb technology as we advance several therapeutic programs toward the clinic in 2014 and 2015," said Julian Bertschinger, Ph.D., chief executive officer of Covagen.

Dragan Grabulovski, Ph.D., chief scientific officer of Covagen, added, "The expansion to a second bispecific FynomAb program is the result of the successful discovery and early preclinical development of the FynomAb from the original collaboration. This FynomAb was generated less than one year after initiating the joint research collaboration and showed excellent activity in pre-defined in vitro and in vivo studies. Our work with the MTPC and TRL team has been extremely productive, and we are eager to continue development of both projects."

About Covagen

Covagen develops bispecific FynomAbs by fusing its human Fynomer binding proteins to antibodies, resulting in therapeutics with novel modes-of-action and enhanced efficacy in the treatment of inflammatory diseases and cancer. Fynomers^® are small binding proteins that can be engineered to bind an antigen of interest. The ability to fuse Fynomers to multiple sites on an antibody allows Covagen to create FynomAbs with tailored architectures to maximize efficacy. Covagen is a privately held Swiss Biotech company with an internal lead bispecific anti-TNF/IL-17A FynomAb moving towards first-in-human studies in early 2014.

For more information, please visit www.covagen.com.

About Tanabe Research Laboratories (TRL)

TRL is an independent subsidiary of Mitsubishi Tanabe Pharma Corporation located in San Diego California, whose role is to discover and develop potential biological drug candidates for therapy. Currently, TRL's efforts are directed towards antibody and antibody related research to target specific immune cells and/or soluble factors. TRL is establishing collaborative relationships with other companies and academic research organizations to further its goals of identifying preclinical lead compounds for therapeutic development.

About Mitsubishi Tanabe Pharma Corporation

Mitsubishi Tanabe Pharma Corporation is a research-driven pharmaceutical company based in Osaka. Our philosophy states that "We contribute to the healthier lives of people around the world through the creation of pharmaceuticals." In accordance with this philosophy, we strive to continually discover drugs with new value and to provide those drugs to patients around the world. Mitsubishi Tanabe Pharma is taking on the challenge of drug discovery in the fields of autoimmune disorders, diabetes, and renal diseases, as well as in other fields with high levels of unmet medical needs. To that end, the Company is strengthening its R&D pipeline.

SOURCE Covagen