The FINANCIAL -- Pharmacyclics announced that it has entered into a worldwide collaboration with Janssen Biotech, Inc., one of the Janssen Pharmaceutical Companies of Johnson & Johnson, to develop and commercialize PCI-32765, a novel, oral, first-in-class Bruton's tyrosine kinase inhibitor  being developed for the treatment of Non Hodgkin's Lymphoma, Chronic Lymphocytic Leukemia and Multiple Myeloma, all of which are considered hematological malignancies. 

PCI-32765 was developed by Pharmacyclics and is currently in Phase II clinical trials. 

Under the terms of the agreement, Pharmacyclics will receive an upfront payment of $150 million.   In addition, Pharmacyclics will receive up to an additional $825 million in development and regulatory milestone payments, based upon continued development, regulatory progress and approval of the product, for total potential upfront and milestone payments of $975 million.

Pharmacyclics and Janssen will collaborate on the development of PCI-32765 for oncology and other indications, excluding inflammation and immune mediated conditions.  Each company will lead development for specific indications as stipulated in a global development plan, with development costs shared on a 40/60 basis .  The agreement includes plans to launch multiple Phase III trials of PCI-32765 over the next several years.

Following regulatory approval, both Pharmacyclics and Janssen will book revenue and co-commercialize PCI-32765.   In the US, Pharmacyclics will book sales and take a lead role in US commercial strategy development and both Pharmacyclics and Janssen will share in commercialization activities.   

Outside the United States, Janssen will book sales and lead and perform commercialization activities.   Profits and losses from the commercialization activities will be equally split on a worldwide basis.  Development and commercialization activities under the collaboration will be managed through a shared governance structure.

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