Clal Biotech co Cadent wins $15m Novartis payment
Cadent could receive $385 million in royalty and milestone payments.
Israeli biotech holding company Clal Biotechnology Industries Ltd.(TASE: CBI) today announced that Cadent Therapeutics, in which it holds a 16% stake, would receive $15 million from Novartis following the beginning of a Phase II clinical trial of Cadent’s product. Cadent has a cooperation agreement with Novartis. Cadent developed a drug for treatment of depression that is resistant to drugs. Clal Biotechnology’s shares rose 0.5% in response to the report, pushing the company’s market cap up to NIS 468 million.
Under the agreement with Novartis, Novartis will be responsible for conducting the trial and registering the drug, and for marketing the product if it reaches the market. Novartis will make payments to Cadent for milestones and royalties. The current $15 million payment is for a milestone. Cadent could eventually receive a total of $385 million in royalty and milestone payments.
The trial will include 66 patients, divided into several groups: groups according to dosages, a control group, and comparison with Ketamine, another drug in development regarded as promising for treatment of depression. The main target of the trial is a change in the Montgomeray-Asberg Depression Rating Scale (MADRS) for the patients treated with the drug in comparison with the control group. The comparison with Katemine is designed mainly for continuation of the development process and for marketing purposes at a later stage. Follow-up of the patients is scheduled for completion in the first quarter of 2020.
Cadent is one of the US drug companies that entered Clal Biotechnology’s portfolio when Clal Industries was acquired by billionaire Len Blavatnik, who merged the medical activity into Clal Biotechnology. Cadent is developing other drugs for neurological and psychiatric diseases, including a drug for treatment of SCA movement disorders and non-Parkinson’s Disease tremors and a drug for treatment of cognitive disorders in schizophrenics.
Cadent raised $40 million last November at a company value of $100 million after money from several investors, including Cowen Healthcare, the biotechnology investment arm of Cowen investment; venture capital funds Qiming Ventures and Atlas Ventures; and Blavatnik’s Access Industries, which also invested directly in Cadent. Novartis has a 10% stake in Cadent.