Switzerland-based drug producer Novartis has purchased a 12.8% stake in Israel-based biopharmaceutical company BiolineRx as part of a multi-year collaboration agreement, according to Reuters.
Novartis paid $10m for the stake, at a price of $2 per American depositary share, in a private transaction.
Under the terms of the agreement, Novartis will evaluate BiolineRx projects for development and possible licensing and gain access to research institutions, hospitals and biotech startups in Israel.
The two companies intend to work together on up to three clinical projects, with Novartis paying an additional $5m option fee per project as well as funding half the development costs in the form of an additional equity investment.
Although Novartis’ total stake in BiolineRx has been limited, the size of its investment has not been disclosed.
BiolineRx was established in 2003 and filed for a $40m initial public offering on Nasdaq in September 2010. It has a market cap of $427m as of the time of writing.