Sandoz and Codexis, a subsidiary of Maxygen Inc announced a collaboration focused on developing an improved process for the production of a key fermented active pharmaceutical compound marketed by Sandoz. Using Codexis' proprietary MolecularBreeding directed molecular evolution, the collaboration will aim to improve the productivity of Sandoz' manufacturing process, reduce the overall capital expenditures necessary to produce each unit of product, and generate novel intellectual property around the synthesis.

Under the terms of the collaboration, Codexis will receive upfront payments, full research and development funding and will be eligible for milestone and royalty payments upon success. Codexis will grant Sandoz exclusive commercialization rights to the improved process for the specific pharmaceutical product.

"Codexis' technologies are ideally suited to provide significant competitive advantage to the pharmaceutical industry in terms of profit margin expansion on existing products and novel intellectual property creation to deter competitive threats," said Alan Shaw, President and Chief Executive Officer of Codexis. "These advantages are also relevant to the ever growing generics industry. We are pleased to be working with one of the world's top generic pharmaceutical companies, Sandoz, and look forward to building on our track record of delivering commercial success to our growing list of pharmaceutical partners."

"We are pleased to be working with Codexis, a demonstrated leader in the area of applying innovative biotechnology-based solutions to the challenges of pharmaceutical process development," according to Ernst Leitner, Head of Research and Development of Sandoz, Austria.

Sandoz, a Novartis company, is a world leader in generic pharmaceuticals and develops, manufactures, and markets these medicines as well as pharmaceutical and biotechnological active ingredients. Decades of experience and profound know-how make Sandoz a renowned partner in Pharmaceuticals, Biopharmaceuticals and Industrial Products. Altogether, Sandoz employs around 11,500 people worldwide and posted sales of USD 1.8 billion in 2002.