Lexicon/Organon (Akzo) Collaboration and License Agreement

On May 16, 2005, Lexicon Genetics announced that it had entered into a Collaboration and License Agreement with N.V. Organon for the joint discovery, development and commercialization of novel biotherapeutics.

In the collaboration, we will create and analyze mouse knockouts for up to 300 genes selected by the parties that encode secreted proteins or potential antibody targets, including two of our existing drug discovery programs.

The parties will jointly select targets for further research and development and will equally share costs and responsibility for research, preclinical and clinical activities. The parties will jointly determine the manner in which collaboration products will be commercialized and will equally benefit from product revenue. If fewer than five development candidates are designated under the collaboration, our share of costs and product revenue will be proportionally reduced. We will receive a milestone payment for each development candidate in excess of five.

Either party may decline to participate in further research or development efforts with respect to a collaboration product, in which case such party will receive royalty payments on sales of such collaboration product rather than sharing in revenue. Organon will have principal responsibility for manufacturing biotherapeutic products resulting from the collaboration for use in clinical trials and for worldwide sales.

We will receive an upfront payment of $22.5 million from Organon in exchange for access to our drug target discovery capabilities and the exclusive right to co-develop biotherapeutic products that modulate the 300 genes selected for the collaboration. Organon will also provide us with annual research funding totaling up to $50 million for its 50% share of the collaboration's costs during the four-year target function discovery portion of the alliance."

The Lexicon/Organon (Akzo) Collaboration and License Agreement is here.

Organon is the human healthcare business of Akzo Nobel.