GlaxoSmithKline, Pharmacopeia to collaborate on drug discovery

By Lisa Kerner

Erie, Pa., March 30 - GlaxoSmithKline and Pharmacopeia formed a new drug discovery and development alliance.

Through its recently established Center of Excellence for External Drug Discovery, GlaxoSmithKline said it will collaborate with Pharmacopeia to deliver clinically validated therapeutic candidates to GlaxoSmithKline's global research and development organization.

Under the agreement, Pharmacopeia will receive $15 million in cash payments from GlaxoSmithKline, as well as milestone payments totaling up to $83 million plus royalties, according to a company news release.

For its part, GlaxoSmithKline receives two warrants to purchase up to a total of 176,367 shares of Pharmacopeia stock at $5.67 per share, a $25% premium over the trailing 30-day closing price average preceding the effective date.

The warrants are exercisable before March 24, 2011, or under certain types of agreement terminations, according to the release.

GlaxoSmithKline also has exclusive options to conduct phase 3 clinical trials and to commercialize pharmaceutical products from the collaboration on a worldwide basis.

GlaxoSmithKline is a global research-based pharmaceutical and healthcare company based in London.

Princeton, N.J.-based Pharmacopeia discovers and developments small molecule therapeutics.

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