Compugen Announces $15 Million Funding Agreement for Its Keddem Subsidiary
Keddem's unique technology platform focuses on small molecule drug discovery
TEL AVIV, Israel--(BUSINESS WIRE)-- Compugen Ltd. (Nasdaq: CGEN) announced today the signing of an agreement with a private U.S.-based investment company pursuant to which up to $15,000,000 in milestone related equity financing will be made available to Keddem Bioscience Ltd., currently a wholly owned subsidiary of Compugen. This financing will be used to further develop and commercialize a unique technology platform that has been designed to consistently enable the discovery of small molecule modulators (e.g., drugs, pesticides) for potentially any given protein target. Under the agreement, the new investor will obtain a majority equity interest in Keddem, with Compugen maintaining a minority interest and certain future preferential access rights to utilize the Keddem technology with Compugen discovered drug targets.
Keddem's mission is to dramatically improve the success rate for the discovery and development of new small molecule drug products. At present, identifying a lead molecule for a potential target is a long, arduous and often unsuccessful undertaking, and is a limiting factor in terms of both time and probability of success for novel small molecule drug products. Common methods for finding such molecules are typically variants of screening of drug/lead-like compounds (including "fragment" based approaches) or protein structure-based drug design.
Keddem's platform is designed to provide comprehensive three-dimensional information about the target's relevant site(s), using a standard set of molecular gauges. This set is strictly exhaustive in nature and therefore equally applicable to any protein target amenable to small molecule modulation. The information obtained then enables the design of a variety of potent, selective and bioavailable small molecule modulators for the target, satisfying all pre-specified drug-like properties.
The concept underlying the Keddem technology was initially conceived and developed within the chemistry division of Compugen, which had been created to address this critical industry need. In 2004, the program was transferred to Keddem as a wholly owned subsidiary, where it was further developed, including some initial validation studies, through 2007, when active research was discontinued due to Compugen's decision to focus on its predictive biology programs. Keddem will be managed by Dr. Dror Ofer and Dr. Arnon Levy, both of whom managed the program while it was a division of Compugen, and later, as Co-CEOs of Keddem.
Martin Gerstel, Chairman of both Compugen and Keddem, stated, "We are very pleased that this very exciting small molecule discovery capability will now be able to move forward aggressively in its further development and commercialization. At the same time, this new financing specifically for Keddem enables Compugen to maintain its focus on predictive biology for the discovery of monoclonal antibodies and therapeutic proteins in the fields of immunology and oncology, while at the same time offering potential future benefits to our shareholders from both our equity interest in Keddem and our preferred access to its technology."
Dr. Dror Ofer, Co-Chief Executive Officer of Keddem, stated, "Our technology aims to find small molecule drug candidates for any target protein, including the many so-called 'undruggables.' For many years the pharmaceutical industry suffered from a lack of new targets for therapy; however, now, at least with respect to small molecule drugs, the primary bottleneck is the lack of any methodology to systematically discover modulators for an increasing number of available potential targets. Therefore, we are very enthusiastic about having the opportunity to further develop and commercialize this radically new scientific approach to small molecule discovery."
Compugen is a leading therapeutic product discovery company focused on therapeutic proteins and monoclonal antibodies to address important unmet needs in the fields of immunology and oncology. Unlike traditional high throughput trial and error experimental based drug candidate discovery, Compugen utilizes a broad and continuously growing infrastructure of proprietary scientific understandings and predictive platforms, algorithms, machine learning systems and other computational biology capabilities for the in silico (by computer) prediction and selection of product candidates, with selected candidates being advanced in its Pipeline Program to the pre-IND stage. The Company's business model primarily involves collaborations covering the further development and commercialization of product candidates from its Pipeline Program and various forms of research and discovery agreements, in both cases providing Compugen with potential milestone payments and royalties on product sales or other forms of revenue sharing. In 2012, Compugen established operations in California for the development of oncology and immunology monoclonal antibody therapeutic candidates against Compugen-discovered drug targets. In 2002, Compugen established an affiliate, Evogene Ltd. (www.evogene.com) (TASE: EVGN.TA), to utilize certain of the Company's in silico predictive discovery capabilities in agricultural biotechnology. For additional information, please visit Compugen's corporate website at www.cgen.com.
This press release may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include words such as "may," "expects," "anticipates," "believes," and "intends," and describe opinions about future events. Forward-looking statements in this press release include, but are not limited to, statements relating to the expectation that Keddem will (i) dramatically improve the success rate for discovery and development of new small molecule drug products, (ii) provide information that enables the design of a variety of potent small molecule inhibitors satisfying desired drug-like properties and (iii) will create potential future benefits for Compugen's shareholders from Compugen's equity interest in Keddem and its preferred access to technology. These forward-looking statements involve known and unknown risks and uncertainties that may cause the actual results, performance or achievements of Compugen to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Some of these risks are: changes in relationships with collaborators; the impact of competitive products and technological changes; risks relating to the development of new products; and the ability to implement technological improvements. These and other factors are discussed in the "Risk Factors" section Compugen's Annual Report on Form 20-F for the year ended December 31, 2011 as filed with the Securities and Exchange Commission. In addition, any forward-looking statements represent Compugen's views only as of the date of this release and should not be relied upon as representing its views as of any subsequent date. Compugen does not assume any obligation to update any forward-looking statements unless required by law.
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