Dr. Reddys: Subsidiary partners with oncology expert Exelixis

India-based subsidiary of Dr. Reddy's, Aurigene has entered an exclusive collaboration agreement with the US-based oncology-focused biotech company Exelixis, Inc.

Aurigene Discovery Technologies Limited, a wholly-owned arm of Dr. Reddy's Laboratories, is a development stage biotech company which engages in discovery and development of novel therapies to treat cancer and inflammatory disorders. While Exelixis is a Nasdaq listed company with expertise in development and successful commercialisation of new medicines for difficult-to-treat cancers.

The two companies will collaborate to advance small molecules in close to six projects, including three existing programs against specific pre-determined targets. Exelixis will get an opportunity to in-license these programs from Aurigene which are differentiated best-in-class drug opportunities with unique mechanisms of action.

According to the terms of the deal, Exelixis will make an upfront payment of US$10 million for exclusive options to license three pre-existing Aurigene programs and the two companies will team-up to initiate three Aurigene-led drug discovery programs on mutually-agreed upon targets for additional option payments of US$2.5 million per program. Exelixis will also contribute fund for research to facilitate discovery and pre-clinical development work on all these programs. Also, Exelixis will have the opportunity to exercise an exclusive option for the programs before the time of filing for Investigational New Drug (IND) acceptance and make option exercise payments to Aurigene and help in the program's clinical development and commercialization including global manufacturing.

Meanwhile, on Thursday, the stock of Dr. Reddy's Laboratories was quoting Rs. 2,528.40 per share, down by 1.79 per cent at 11:59 hours on BSE.