MTPC, Medicago partner to develop and commercialize three new vaccines

Medicago Inc. (TSX: MDG), a biopharmaceutical company focused on developing highly effective and competitive vaccines based on proprietary manufacturing technologies and Virus-Like Particles (VLPs), today announced the establishment of a strategic alliance with Mitsubishi Tanabe Pharma Corporation (MTPC) through the execution of a Master Research Collaboration Agreement.  The objectives are to develop and commercialize at least three new vaccines with MTPC who will provide funding for all research and development costs. In exchange for granting licensing rights, Medicago will be entitled to receive upfront and milestone payments as well as royalties for each product to be developed under this master agreement.

Under this first agreement to develop a Rotavirus Like Particle (RLP) vaccine target, MTPC will have the option to license the RLP vaccine target and assume global development, regulatory and commercialization responsibilities while Medicago will be eligible to receive up to a total of C$33 million in upfront and milestone payments as well as royalties on future sales of the RLP product. Medicago will receive an upfront payment of C$3 million to begin the initial research on rotavirus. Work on an RLP vaccine target will begin immediately, and additional targets under this master agreement are to be selected by the parties at a later date.

"I am proud to announce this strategic alliance with Mitsubishi Tanabe Pharma for the development of several new vaccines. It vividly demonstrates the value that pharmaceutical companies place on new technology production platforms that have the potential to improve efficacy, cost and speed of production," said Andy Sheldon, President and CEO of Medicago.  "This collaboration leverages the significant strengths of our two companies towards a shared vision that can positively impact vaccine development and benefit patients worldwide."

"We have the utmost respect for Mitsubishi Tanabe Pharma's scientific and commercial leadership in vaccines," said Frederic Ors, Vice President, Business Development of Medicago. "This collaboration is consistent with our business strategy to develop new vaccine targets with significant market potential along with a knowledgeable partner that is committed to supporting rapid development."

"We are excited to be forming this strategic alliance with Medicago using their innovative, plant-based VLP technologies. Our research collaboration aims to create new and better vaccines that will improve the health of people around the world," said Dr. Michihiro Tsuchiya, President and Chief Executive Officer of MTPC.

Rotavirus is the most common cause of severe diarrhea in infants and young children globally. The worldwide incidence of rotavirus is estimated at 125 million cases each year, and is responsible for more than 500,000 deaths annually. More than 85% of these deaths occur in Africa and Asia, and over two million are hospitalized each year with pronounced dehydration. Children under five years of age, especially those between six months and two years, are most vulnerable to the disease. While vaccines against rotavirus gastroenteritis are currently available and are the single prevention and control measure with the most significant impact on reducing severe disease incidence, economic barriers to access remain an issue in many developing countries.

In addition to the RLP vaccine target, Medicago's pipeline includes the initiation of a U.S. Phase II clinical trial for a seasonal flu vaccine with interim data expected in the third quarter of this year.  A Phase I clinical trial for a one-dose H5N1 VLP vaccine with a new adjuvant is planned for the second quarter of 2012, in partnership with the Infectious Disease Research Institute (IDRI), with interim data expected in the second half of this year.  GMP process development and a GLP toxicology study for a rabies vaccine are ongoing. In addition to vaccines, Medicago is conducting research and development in the area of biosimilar products.