CAMBRIDGE, Mass., Jan. 8, 2009 (GLOBE NEWSWIRE) -- Infinity Pharmaceuticals, Inc. (Nasdaq:INFI), an innovative cancer drug discovery and development company, announced that its shareholders have voted to approve the issuance and sale of $30 million in Infinity common stock and warrants to Purdue Pharma L.P. and Purdue Pharmaceutical Products L.P. This sale is pursuant to a global strategic alliance previously entered into by Infinity, Purdue and Mundipharma International Corporation Limited. This transaction brings the total potential size of the Infinity/Purdue/Mundipharma relationship to more than $500 million, as Purdue has now invested a total of $75 million in Infinity equity and has made available a $50 million line of credit for use by Infinity for any business purpose, and Mundipharma may provide approximately $400 million in R&D funding if the funded research program extends for the full five year period.
In November 2008, Infinity and Mundipharma entered into an alliance focused on the research, development, and commercialization of Infinity's early clinical and discovery programs, including IPI-926, Infinity's novel inhibitor of the Hedgehog signaling pathway. Under the terms of this alliance agreement, Mundipharma will fund 100% of Infinity's R&D costs for alliance programs. At that time, Purdue made a $45 million equity investment in Infinity and committed to a line of credit subject to the successful completion of the second equity closing. With the consummation of the second closing, Infinity expects to have sufficient cash to fund its current operations and research, development and commercial plans through 2012.
"Our alliance with Purdue Pharma and Mundipharma provides Infinity with the resources to continue growing as an independent organization and confidently advance our deep, innovative pipeline," stated Steven H. Holtzman, chair and chief executive officer of Infinity. "Our mission is to discover, develop, and deliver to patients important medicines for the treatment of cancer while also creating exceptional shareholder value. We look forward to working with Purdue and Mundipharma to execute on our mission in the months and years to come."
Following Infinity's shareholder vote, Purdue made an additional $30 million investment in Infinity through the purchase of two million shares of Infinity common stock and warrants to purchase up to six million additional shares of Infinity common stock at a price of $15 per unit, representing a significant premium over Tuesday's closing price of Infinity common stock of $7.27 per share. The warrants may be exercised between today and expiration dates between July 1, 2010 and July 2, 2012 at prices ranging from $15 to $40 per share.
As a result of this second closing, Infinity will have access to a $50 million line of credit for use by Infinity for any business purpose. Draws under this facility may be made at any time after April 1, 2009, with principal and accrued interest to be repaid, in cash or Infinity common stock, by January 7, 2019.
"This alliance provides a significant opportunity for Infinity to realize the promise of our pipeline -- delivering important new medicines to patients and value to shareholders," said Adelene Q. Perkins, president and chief business officer of Infinity. "The terms of these agreements bolster our already-strong financial profile, enabling us to further invest in our productive discovery efforts, expand our development teams, and build out our U.S. commercial infrastructure. In addition, Mundipharma's growing oncology presence outside the United States and Purdue Pharma's leadership in pain management position us to maximize the therapeutic and global commercial potential of our pipeline."
Details of the Alliance
In November 2008, Infinity entered into strategic alliance agreement with Mundipharma to develop and jointly commercialize Infinity's Hedgehog program and new Infinity discovery and development programs for three years, with an ability to extend this right for two additional one-year terms. Under this alliance, Infinity will commercialize in the United States all oncology products developed under these programs. Infinity is obligated to pay Mundipharma a royalty on U.S. sales of these products. Mundipharma has the right to commercialize these products outside of the United States, and is obligated to pay a royalty to Infinity on sales outside of the United States. Infinity will direct and lead all oncology discovery and development efforts on a worldwide basis.
In addition to Infinity's Hedgehog pathway inhibitor program and new discovery and development programs, the alliance also encompasses Infinity's program directed to fatty acid amide hydrolase (FAAH). Purdue and Mundipharma will have the right to assume development of the FAAH program at the conclusion of Phase 1 clinical studies by funding the research and development costs of the program through approval and paying a royalty to Infinity on global net sales.
Mundipharma will pay 100% of all research and development expenses incurred by Infinity for all early discovery projects and for each product candidate until the later of December 31, 2013 and the commencement of the first phase 3 clinical study of such product candidate. Infinity and Mundipharma have agreed upon a three year budget for research and development expenses of $200 million for the period beginning on November 19, 2008 and ending on December 31, 2011.
Finally, under the alliance Infinity granted to Mundipharma an option to participate on set terms in programs that Infinity may in-license during the term. Mundipharma will have the right to opt-out of development of any particular program on an annual basis, with the first opt-out right becoming available in July 2009 for the Hedgehog and FAAH programs. If Mundipharma elects to opt-out of a program, it will be obligated to continue funding that program for an additional year, and have the right to receive royalties on future sales based on the stage of development of the program when the election to opt-out took place.
About Infinity Pharmaceuticals, Inc.
Infinity is an innovative cancer drug discovery and development company seeking to discover, develop, and deliver to patients best-in-class medicines for the treatment of cancer and related conditions. Infinity combines proven scientific expertise with a passion for developing novel small molecule drugs that target emerging cancer pathways. Infinity's two most advanced programs in Hsp90 inhibition and Hedgehog signaling pathway inhibition are evidence of its innovative approach to oncology drug discovery and development. For more information on Infinity, please refer to the company's website at http://www.infi.com.
This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause actual results to be materially different from historical results or from any future results expressed or implied by such forward-looking statements. Such forward-looking statements include statements regarding expected future research and development funding by Purdue and Mundipharma, the expected benefits of the strategic alliance with Purdue and Mundipharma, and the expectation that Infinity will have cash to support its current operating plan through 2012. Such statements are subject to numerous factors, risks and uncertainties that may cause actual events or results to differ materially from Infinity's current expectations. For example, there can be no guarantee that the strategic alliance with Purdue and Mundipharma will continue for its expected term or that Purdue and Mundipharma will fund Infinity's programs as agreed, or that any product candidate Infinity is developing will successfully complete necessary preclinical and clinical development phases. In particular, management's expectations could be affected by risks and uncertainties relating to: results of clinical trials and preclinical studies, including subsequent analysis of existing data and new data received from ongoing and future studies; the content and timing of decisions made by the U.S. Food and Drug Administration and other regulatory authorities, investigational review boards at clinical trial sites, and publication review bodies; Infinity's ability to enroll patients in its clinical trials; unplanned cash requirements and expenditures; and Infinity's ability to obtain, maintain and enforce patent and other intellectual property protection for any product candidates it is developing. These and other risks which may impact management's expectations are described in greater detail under the caption "Risk Factors" included in Infinity's registration statement on Form S-3 filed with the Securities and Exchange Commission on December 17, 2008. Further, any forward-looking statements contained in this press release speak only as of the date hereof, and Infinity expressly disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
Infinity Pharmaceuticals, Inc. Monique Allaire 617-453-1105 http://www.infi.com
Infinity Pharmaceuticals, Inc.
Cambridge, Massachusetts, UNITED STATES
Infinity Pharmaceuticals, Inc. Monique Allaire 617-453-1105 http://www.infi.com
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