Biotechnology company Anatara Lifesciences (ASX: ANR) has teamed up with animal health developer Zoetis Inc. to develop, manufacture and distribute its Detach product.
The news is significant given that Zoetis has over 60 years’ experience in the sector and currently derives almost two thirds of its US$5.3 billion annual revenue from farm animal health products.
The exclusive licensing agreement will also include marketing of Detach, as a non-antibiotic approach to aid in the control of diarrhoeal disease – otherwise known as ‘scour’ – in livestock and horses.
The rationale behind the deal is to promote Anatara’s Detach technology given its proven ability to control gastrointestinal diseases in livestock and production animals without the use of antibiotics – the current go-to method for treating such ailments.
Anatara is currently developing non-antibiotic oral solutions for gastrointestinal diseases in animals and humans and claims that its lead product Detach is a natural product that will help address global concerns around the overuse of antibiotics in animals and their feed that is contributing to the rise of so-called “superbugs” that make infectious diseases harder to treat.
The agreement demonstrates both companies’ commitment to the responsible use of antibiotics in the food chain and finding natural alternatives to help control gastrointestinal disease.
Under the terms of the license agreement, Anatara has granted Zoetis exclusive rights to develop, manufacture, distribute and market Detach worldwide, including in Australia.
The agreement follows an exclusive research evaluation and license option period first announced back in 2016. Since then, Zoetis has actively evaluated Detach for use as a non-antibiotic product in livestock species and has culminated in a deal that was announced today.
The terms of the agreement include an upfront payment as well as milestone payments further down the track including royalties based on product sales. However, intellectual property rights “exclusively licensed” to Zoetis under the agreement shall remain the sole property of Anatara.
Given the sensitive nature of the agreed terms including intellectual property and commercial safeguards, Anatara has remained tight-lipped about the fine points of the agreement saying that “exact details remain confidential” at this time.
“Through signing this agreement with Zoetis, Anatara has reached a major commercial milestone – this an exciting moment for our shareholders,” said Dr Mel Bridges, executive chairman of Anatara Lifesciences.
“The global reach and resources that Zoetis is able to apply to making Detach a successful product are of great value to Anatara,” said Dr Bridges.
According to Dr Scott Brown from Zoetis, “veterinarians and livestock farmers are seeking new, integrated solutions to help keep animals healthy.” He also said that Zoetis will continue research into this “novel approach” and that Zoetis “intends to explore its place in our diverse portfolio of solutions”.
News of today’s deal with Zoetis helped Anatara shares to gain almost 20% up to as high as $1.72 per share in early trade this morning.