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Curagen, Bayer Receive FTC Approval for $124 Million Deal

NEW YORK, Feb 22 - Bayer and Curagen received clearance from the Federal Trade Commission Thursday to complete a $124 million functional genomics deal and a $1.34 billion deal to jointly develop obesity drugs.

The proposed deal did not violate the Hart-Scott-Rodino Antitrust Improvements Act of 1976, the FTC said. Following the approval, Bayer completed the purchase of $85 million in Curagen common stock.

"This alliance will enable Curagen scientists to access the untapped potential that genomics holds for the development of small molecule drugs," Jonathan Rothberg, CEO of Curagen, said in a statement. "We believe that Curagen and Bayer's combined, systematic approaches to drug development will enable the creation of blockbuster genomics-based drugs that will significantly curtail the devastating effects of obesity and adult onset diabetes."

Under the collaboration, the companies plan to create an annotated database of gene-based markers to help researchers predict drug toxicity, understand how a particular drug works, and identify new disease indicators. Curagen and Bayer will have the sole rights to use the database without charge, although Curagen will be able to market the database and Bayer will be entitled to royalties.

Separately, Curagen has agreed to provide 80 drug targets for obesity and adult onset diabetes over five years. Curagen will also give Bayer access to its functional genomics technologies, bioinformatics, and pharmacogenomic expertise. Bayer will then use its high-throughput screening techniques, combinatorial chemistry, medicinal chemistry, pharmacology, and development expertise to create small molecule compounds against the targets.

The two companies have agreed to share expenses related to later stage preclinical and clinical compound development and have committed to bring 12 candidates in obesity and diabetes to clinical development.

The companies will share profits for any resulting drugs based on their contribution to the development costs.

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