Vancouver biotech Sirona Biochem Corp. (TSX-V:SBM) has signed a $9.5 million licensing deal with China's Wanbang Pharma to develop a new drug for Type 2 diabetes based on one of Sirona's new drug candidates.
Sirona specializes in flourination chemistry, which is used to stabilize carbohydrate molecules that are known to have the potential therapeutic value, but which are unstable and can be toxic.
One of the molecules it has developed is called the SGLT2 inhibitor, a new class of drug that may have treatment applications in Type 2 diabetes.
Traditional drug therapies for Type 2 diabetes work by increasing insulin production in the pancreas, whereas SGLT2 inhibition works on the kidneys to reduce the reabsorption of glucose into the bloodstream, according to Sirona.
Under its agreement with Wanbang Pharma, the Chinese pharmaceutical company will acquire the rights from Sirona to use its SGLT2 inhibitor develop and commercialize a new diabetes treatment drug.
Sirona CEO Neil Belenkie said the deal takes a lot of the clinical trial costs off of Sirona because Wanbang will pay for the clinical trials in China, and some of the data from those trials could be used once Sirona or some other pharmaceutical company tries to get the drug approved by the American Food and Drug Administration (FDA) for use in the U.S.
Belenkie said it would cot $75 to $100 million to do the clinical trials in North America. Sirona would have the option of augmenting the Chinese trials in order to get the drug approved for use in North America.
"What it means is we don't have to spend $100 million to take this to market," Belenkie said. "We would take everything that they do and just build on it with minimal investment to make it full FDA (compliant)."
