Cadus Sells Drug Discovery Program, Assets to OSI Pharmaceuticals

Cadus Pharmaceutical Corp. (Tarrytown, NY) has sold its drug discovery assets to OSI Pharmaceuticals Inc. (Uniondale, NY) for approximately $1.5 million in cash and other considerations.

Under the terms of the deal, OSI will receive from Cadus:

• Its drug discovery programs focused on G protein-coupled receptors.
  
• Its directed library of approximately 150,000 small molecule compounds specifically designed for drug discovery in the G protein-coupled receptor arena.
  
• Its collaboration with Solvay Pharmaceuticals B.V.
  
• Its lease to its research facility in Tarrytown, NY together with the furniture and fixtures and its lease to equipment in the facility.
  
• Its inventory of laboratory supplies.

OSI has agreed to employ more than 45 of Cadus's scientific and administrative personnel. In addition to paying the up-front cash, OSI assumed certain liabilities of Cadus as consideration for the sale. Cadus would also be entitled to royalties and up to $3.0 million in milestone payments on the first product derived from compounds sold to OSI or from the collaboration with Solvay Pharmaceuticals B.V.

While Cadus will retain ownership of all its other assets, the company will cease its drug discovery operations and research efforts for collaborators as a result of the transaction. OSI will assist Cadus in winding up its research efforts on behalf of SmithKline Beecham Corp. Consequently, Cadus has terminated all employees who were not hired by OSI, except for two officers and four transitional employees.

Cadus Pharmaceutical Corp. develops novel drug discovery technologies that exploit the similarities between the yeast and human genomes and utilize yeast cells as the platform of drug discovery.

For more information: Cadus Pharmaceutical Corp., 777 Old Saw Mill River Rd., Tarrytown, NY 10591-6705. Tel: 914-467-6200. Fax: 914-345-3565.