Glaxo Group and GlaxoSmithKline Research & Development (GSK) have entered into a worldwide non-exclusive agreement with Vectura Group to license some of Vectura's dry powder drug formulation patents in relation to two late stage development compounds in GSK's respiratory product pipeline.
As per the terms of the agreement, GSK is expected to pay to Vectura up to €20m in up-front and milestone payments. Vectura is expected to receive an initial up-front payment of €10m in September 2010, with the remaining €10m expected to be received by the time of launch of both compounds.
The agreement is also expected to allow Vectura to receive royalties capped at certain levels of sales of these products. The maximum annual royalties payable to Vectura under this license agreement will be €13m.
Chris Blackwell, chief executive of Vectura, said: "GSK is one of the developers of respiratory medicines and I believe this deal reflects the importance of Vectura's respiratory technology IP.
"The non-exclusive nature of this agreement also allows us to continue our efforts to deliver further value for shareholders from our inhaled therapy technologies in the future."