Teva Pharmaceutical Industries has agreed to make a $35m upfront payment to US-based medical device maker Microchips Biotech as part of a strategic partnership agreement.
The $35m will consist of an equity investment and technology access fee. Microchips has developed an implantable drug delivery device that can hold several hundred doses and release them into the patient’s bloodstream at precise moments over the course of months or years.
Teva and Microchips expect the partnership, whch will involve finding ways to combine Microchips’ drug delivery system to Teva’s product range, to improve the treatment of patients relying on chronic drug therapies.
The partnership will initially focus on one, undisclosed disease area, but Teva has the option to expand the agreement. Microchips will be entitled to development and commercial milestone payments as well as royalties and funding to develop products based on Teva’s future pipeline.
Meanwhile, Teva will be responsible for Phase 2 and 3 clinical trials for any of the joint discoveries, and for seeking regulatory approvals. The total value of the deal has not been disclosed.
According to a regulatory filing, Microchips secured $18.6m in funding last week, though it is unclear whether this is a separate funding round or the equity part of the upfront payment.
Microchips previously raised more than $55m from backers including Novartis Venture Fund, the corporate venturing unit of drug developer Novartis, medical device maker Medtronic, InterWest Partners, Polaris Venture Partners, Flybridge Capital Partners, Saints Capital, Intersouth Partners, Care Capital and CSK Venture Capital.
Microchips’ technology is based on research by Robert Langer and Michael Cima, and is a spin-out of Massachusetts Institute of Technology.