In a deal worth up to €67M, industry giant Nestlé Health Science will have the global rights to commercialize Valbiotis’ food supplement for lowering the rate of type 2 diabetes in people at high risk of developing the condition.
Under the terms of the deal, the French biotech will receive an upfront payment of €4.7M from Nestlé, along with up to €62M in undisclosed development and sales milestone payments. The proceeds from the partnership will let Valbiotis complete phase II/III testing of its dietary supplement. The company hopes that this will then provide enough evidence for the US and EU to validate its claim that the supplement can reduce the risk of prediabetes progressing into full-blown type 2 diabetes.
As Valbiotis’ lead candidate is a food supplement and not a medical treatment, the partners don’t legally need to complete clinical trials to take it to market. Therefore, they may decide to commercialize the product before the product’s health claim is authorized in the EU and US.
“Nestlé Health Science is an ideal strategic partner for Valbiotis,” stated Sébastien Peltier, CEO of Valbiotis. “Its global reach, strategic intent to develop science-based nutritional health solutions, and focus on fighting metabolic disorders like diabetes will be instrumental.”
Valbiotis’ lead candidate food supplement is a combination of extracts from five undisclosed plants. The company says that this combination acts simultaneously on the pancreas, liver, and gut to reduce blood glucose levels and body weight, two risk factors for type 2 diabetes. The product was the first of its kind to show that it can reduce blood glucose levels and body weight in prediabetic people in a phase IIa trial last year.
Valbiotis’ stock price on Euronext has reacted very positively to the Nestlé partnership, increasing by 30% since Monday.
In addition to its lead candidate, Valbiotis has other food supplements ready to enter phase II testing. These supplements are designed to lower the risks of cardiovascular disease by lowering high blood pressure and reducing harmful forms of blood cholesterol, or to reduce fat in the liver and delay the development of non-alcoholic steatohepatitis, or NASH.
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