NEW YORK, March 12 – Abbott Laboratories and Millennium Pharmaceuticals said Monday that they agreed to enter a five-year, $250 million strategic alliance to jointly discover and develop obesity and diabetes drugs.
Under the terms of the agreement, Abbott of Abbott Park, Ill., said it would purchase $250 million worth of Millennium’s common stock. Abbott will acquire $50 million at the closing of the deal and the remaining $200 million over the next two years.
In a statement, the companies said that they had both committed to contributing their metabolic disease research pipelines exclusively to the new partnership with more than 35 projects in the alliance at the outset. They have also agreed to contribute equally to the collaboration, which will be staffed by 250 people during phase one.
Millennium of Cambridge, Mass., and Abbott said they would combine their genomics and drug discovery technologies in an exclusive partnership focused on obesity and diabetes. The companies will also utilize the genomic and molecular discoveries of the joint research program for the development of diagnostic and pharmacogenomic products for metabolic disease.
In January Bayer, a competitor of Abbott Laboratories, and CuraGen, a competitor of Millennium, agreed to work together to discover and commercialize small molecule drugs for treating obesity and adult onset diabetes as part of a deal valued at $124 million.
Abbott and Millennium expect to deliver two drug candidates into the clinic by next year with an additional two to three drug candidates each following year.
"The strength of the two companies together will enable the discovery and development of more medicines than either of us could bring forward alone," said Miles White, CEO of Abbott Laboratories.
Abbott said it would supply any targets and lead compounds developed with Karo-Bio and Metabolex to the partnership with Millennium.