Oncothyreon, Array BioPharma to develop and commercialize ARRY-380 for breast cancer patients

Oncothyreon Inc. (NASDAQ: ONTY) and Array BioPharma Inc. (NASDAQ: ARRY) today announced that they will collaborate to develop and commercialize ARRY-380, an orally active, reversible and selective small-molecule HER2 inhibitor. HER2, also known as ErbB2, is a receptor tyrosine kinase that is over-expressed in breast cancer and other cancers such as gastric and ovarian cancer. Array previously completed a Phase 1 clinical trial of ARRY-380 in patients with heavily pre-treated metastatic breast cancer which demonstrated that the compound was well tolerated and had anti-tumor activity.

Oncothyreon has agreed to pay Array an upfront fee of $10 million upon initiation of the collaboration. Under the agreement, Oncothyreon will fund and conduct the clinical development of ARRY-380 through a defined set of combination proof-of-concept trials in patients with metastatic breast cancer, including patients with brain metastases. ARRY-380 has demonstrated superior activity, based on overall survival, compared to Tykerb® (lapatinib) and to the investigational drug, neratinib, in an intracranial HER2+ breast cancer xenograft model. This provides a strong rationale to explore whether ARRY-380 can provide benefit to patients with brain metastases, which occur in approximately one-third of women with metastatic HER2+ breast cancer.

Oncothyreon and Array intend to jointly conduct Phase 3 development supported by the proof-of-concept studies, with each party retaining the right to opt out of further development and commercialization in exchange for a significant royalty. Array is responsible for worldwide commercialization of the product. Oncothyreon has a co-promotion right in the U.S., and the two companies will share the cost of U.S. commercialization, including any profit, equally. Outside of the U.S., Oncothyreon will receive a double-digit royalty on net sales intended to approximate a fifty percent profit share, and the two companies will share equally the proceeds from any sublicense of marketing rights.

"We are pleased to expand our pipeline of oncology products in development through this collaboration with Array," said Robert L. Kirkman, M.D., President and Chief Executive Officer of Oncothyreon. "As the only selective small-molecule inhibitor of HER2 in clinical development, we believe ARRY-380 has the potential to significantly enhance the care of women with metastatic breast cancer."

"We believe ARRY-380 has the potential to be a very important long-term treatment option for patients living with breast cancer," said Ron Squarer, Chief Executive Officer, Array BioPharma. "We are pleased to have a partner in Oncothyreon to advance the drug through these important proof-of-concept studies and beyond."