Onyx Pharmaceuticals, Inc. has entered into an exclusive agreement with Ono Pharmaceutical to develop and commercialise two compounds from Onyx’s proteasome inhibitor development program, carfilzomib and ONX 0912. The potential value of the transaction, which includes rights to all oncology indications for the two molecules, is estimated to exceed $300 million, plus royalties.

Ono will pay Onyx an upfront payment of ¥ 5 billion, approximately $ 59 million. In addition, Onyx will receive development and sales-based payments related to the compounds that could total up to approximately $ 280 million at current exchange rates. The agreement also calls for royalty payments in double-digit percentages on net sales in Japan, commensurate with a late-stage asset. Under the terms of the agreement, Ono has exclusive rights to develop and commercialise both compounds for all oncology indications in Japan. Onyx retains commercialisation rights in other countries in the Asia Pacific region, as well as in all other regions of the world, including the US and Europe.

“This strategically important transaction underscores the growing interest and excitement surrounding carfilzomib. Ono is an ideal partner in Japan given their focus on highly innovative new pharmaceutical products and their reputation for scientific excellence. Onyx is committed to reaching all patients with multiple myeloma who could potentially benefit from promising therapies such as carfilzomib and ONX 0912, as quickly as possible. This partnership allows us to benefit from Ono’s drug development experience in Japan for the advancement of carfilzomib, while we focus on execution in the U.S. and Europe,” said N Anthony Coles, M D, president and chief executive officer of Onyx.

Carfilzomib, a highly selective proteasome inhibitor, is currently being evaluated in multiple clinical trials for the treatment of patients with multiple myeloma and other cancers. ONX 0912, an oral proteasome inhibitor, is currently in Phase 1 testing.

In the US Onyx is preparing a new drug application (NDA) for carfilzomib, which it expects to submit to the Food and Drug Administration (FDA) by year-end 2010 for potential accelerated approval. Given this potential timeline, Onyx is engaged in planning and executing pre-launch activities.

“Ono is actively engaged in the development and the commercialisation of innovative drugs in cancer and related areas, including Emend for chemotherapy-induced nausea and vomiting and an antibody anticancer drug, as well as drugs for cancer anorexia/cachexia and for opioid-induced constipation, and recognizes the tremendous need for new treatment options for multiple myeloma. This agreement facilitates Ono’s strategic expansion of its development pipeline in the oncology area with these exciting new compounds from a proven class of drugs. The promising activity and tolerability observed to date indicate that carfilzomib may be an important new treatment option for myeloma patients, and we look forward to collaborating with Onyx to bring this drug to patients in Japan,” said Gyo Sagara, president, representative director and chief executive officer, Ono.