Novartis to terminate its research collaboration agreement with Idera Pharmaceuticals

Idera Pharmaceuticals, Inc. (Nasdaq: IDRA), today announced that Novartis will terminate its research collaboration agreement with the Company, effective as of February 21, 2010.

“We appreciate the commitment Novartis scientists provided throughout our four-plus years of collaboration, during which Novartis selected QAX935 (IMO-2134) as a lead candidate and commenced clinical evaluation by intranasal delivery in late 2008,” said Sudhir Agrawal, D.Phil., Chief Executive Officer and Chief Scientific Officer. “In the last five years at Idera, we have advanced multiple IMO compounds into clinical studies with IMO-2055 partnered with Merck KGaA for cancer treatment and with IMO-2125 for treatment of chronic hepatitis C virus infection. Additionally, we have recently filed an Investigational New Drug application for IMO-3100 for potential applications in autoimmune diseases. As we regain the rights to IMO-2134, we look forward to outlining strategies for the development of our TLR-targeted compounds for respiratory diseases.”

In May 2005, the Company entered into a research collaboration and option agreement and a separate license, development, and commercialization agreement with Novartis to discover, develop, and commercialize TLR9 agonists that are based on Idera’s proprietary IMO chemistry and identified as potential treatments for asthma and allergies. Under the terms of the research collaboration agreement, Novartis paid the Company a $4.0 million upfront license fee and in 2007 a $1.0 million payment associated with the extension of the research collaboration. In March 2008, the Company agreed to extend the research collaboration until December 31, 2008. The parties agreed to the extension in order to allow for the advancement of QAX935 (IMO-2134), a novel agonist of TLR9 identified in the collaboration, into human clinical trials prior to the end of the research collaboration term. The Company received a $1.0 million milestone payment from Novartis as a result of the initiation of the Phase 1 clinical study. As a result of the termination of the research collaboration agreement, the Company will regain all rights to IMO-2134 without any financial obligations to Novartis and will no longer be subject to restrictions on its right to develop its TLR-targeted compounds, including its TLR antagonists and TLR antisense oligonucleotides, for respiratory diseases.