The two companies' candidate, currently going by the name CDP323, is an oral VLA-4 antagonist (as is Tysabri) intended for the treatment of relapsing-remitting multiple sclerosis (MS).
The Phase II trials are expected to yield results by the end of 2008.
Biogen Idec hopped on board to partner with UCB in developing and commercialising the small molecule compound back in October last year, following encouraging Phase I trials.
The two companies are initially investigating the compound for the treatment of MS, but will also be considering its use in treating other autoimmune disease indications.
UCB and Biogen are co-developing and co-commercialising the compound, with all commercialisation costs and profits to be shared equally.
Over $200m (€149m) will be added to UCB's coffers courtesy of the Biogen deal.
CDP323 is one of the few oral alpha-4 integrin antagonists according to UCB, and it's hoped that by tapping Biogen's expertise in multiple sclerosis the two companies can come up with a competitive product.
Biogen is already responsible for the market-leading MS drug worldwide, Avonex (interferon beta-1a), which brought the company revenues of around $1.7bn over 2006.
However, the company has taken a few punches over the last few years regarding an existing injectable MS treatment, Tysabri (natalizumab).
Tysabri, also a VLA-4 antagonist, was approved by the US Food and Drug Administration (FDA) for relapsing-remitting forms of MS back in 2004, however was hastily withdrawn three months later after cases of patients developing a life-threatening viral infection of the brain.
The occurrence of progressive multifocal leukoencephalopathy (PML) in certain patients held Tysabri of the market for a significant period of time, only returning with stringent guidelines in June last year.
Damage to Biogen and Tysabri partners Elan's potential revenues was significant, with original analyst estimates for the treatment predicting annual revenues of up to $3bn, but following its withdrawal and late relaunch the drug only managed to generate $74m over 2006 - split between Elan and Biogen.
Although the companies have initiated risk management plans in the US and Europe to facilitate the correct use of Tysabri, the firms clearly recognise that the damage have may have already been done, with Biogen foreseeing "many rumours and speculation regarding Tysabri and suspected cases of PML" in the future.
Despite the unfavourable aura surrounding the existing version of Tysabri, a spokesperson for UCB told in-PharmaTechnologist.com that the two companies "strongly believe an oral solution is worthwhile exploring," and that the product could potentially become one of the firm's bigger products.
A 24-hour oral formulation of the drug could have significant advantages over the current monthly version of Tysabri in that it could reduce the likelihood of PML taking hold in a patient, as well as the more obvious non-invasive aspect of drug administration.
It's perhaps unsurprising that Biogen is hoping to catch the next big wave in MS treatment by successfully producing an oral formulation whilst simultaneously reaffirming its position in the MS market and hopefully demonstrating the safety of a Tysabri-like treatment option.
In addition to this, the MS market is growing fairly rapidly, and the first non-invasive oral treatment to become available would earn itself a particularly favourable position and at least a temporary monopoly while competitors catch up.
Several firms are fighting to be the first on the market with a non-invasive treatment option for MS sufferers.
Only earlier this month Teva and partners Active Biotech announced their oral candidate was entering Phase II trials, and Novartis' hotly tipped oral MS treatment (FTY720, fingolimod) is on track for submissions in 2009.