Chicago-based pharmaceutical giant AbbVie (NYSE: ABBV), through its subsidiary Allergan Aesthetics, signed a multi-year exclusive licensing agreement with Sirona Biochem (TSX-V: SBM) (FSE: ZSB) (OTC: SRBCF) for its library of skin care compounds. This included a license to commercialize and market Sirona's novel TFC-1067 skincare compound, which is expected to become the new gold standard for skin lightening and dark spot correction.
During its latest human trials, Sirona found TFC-1067's efficacy to be much higher than the current gold standard, hydroquinone, in treating hyperpigmentation, dark spots, and melasma. AbbVie plans to capitalize on that fact by creating a new product line based on the compound. Apart from upfront payments, Sirona stands to receive royalty payments on sales of all products sold by AbbVie using its patented compounds.
Sirona's chief executive, Howard Verrico, said the deal further validates the results of their research and development of TFC-1067. He added that the compound is a viable ingredient for next-generation skincare products and treatments, which will be much safer and more effective in the treatment of various skin conditions.
While the two companies did not disclose the numbers involved in the deal, analysts expect Sirona Biochem to receive significant annual royalty payments once AbbVie solidifies its presence in the $8 billion skin-lightening market with its future product
Pullan Consulting, which assisted in the transaction, said AbbVie's massive presence in the cosmetic and aesthetic market compliments Sirona's disruptive new technology. The company expects both parties to benefit greatly from the deal, with AbbVie having a breakthrough new product line and Sirona receiving a steady income from royalty payments. Pullan Consulting noted that AbbVie has the means, resources, and network to successfully market Sirona's breakthrough compound.
Apart from its breakthrough TFC-1067 molecule, Sirona is also working on other novel compounds aimed at treating skin conditions such as keloids, wrinkles, and cellulite. It is also working on a new treatment for animals with diabetes as well as a new anti-viral drug for humans.
Sirona Biochem recently updated its patent on an existing compound aimed at the multi-billion-dollar anti-aging and anti-wrinkle market. The company also had other in-development compounds, which it plans to license to other pharmaceutical companies down the road. Sirona Biochem and its wholly-owned subsidiary TFChem have received multiple government grants and scientific awards for the development of its proprietary carbohydrate bonding technology using fluorine atoms. The technology enables the company to create different compounds with unique properties that can be used for pharmaceutical and cosmetic applications.