Middletons has acted for Mesoblast on an equity and licensing deal with initial upfront payments of approximately $US350 million, and milestone payments of up to $US1.7 billion, with Mesoblast retaining the manufacturing rights for its products to be sold to Cephalon.

It is believed to be one of the largest phase two stage biotech deals ever completed, with many commentators now suggesting the entire potential deal value to be well over $US2 billion, plus revenue sharing.

Middletons' lead biotechnology partner on the deal, Peter Howard, said: "Mesoblast has granted Cephalon exclusive rights to commercialise specified cardiac, central nervous disorder and oncology products based on Mesoblast's proprietary adult stem cell technology platform."

The deal does not cover the area of orthopaedics, diabetes, eye diseases and immune based inflammatory diseases.

"This is a fantastic outcome for our client and a transformational deal for both parties. Under the deal, Cephalon will now partner with Mesoblast on clinical development and delivery and Mesoblast is free to use the technology in its other applications outside of this mutually beneficial relationship," Howard said.

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According to Middletons, deal was truly unique in that no bankers or financiers were involved on the transaction for Mesoblast.

Middletons acted in concert with US law firm Wilson Sonsini Goodrich & Rosati.