Mequon-based Vector Science & Therapeutics announced that it has entered into an option agreement to purchase up to a 15% equity interest in LyoGenesis Plus.

Former Wisconsin Governor Tommy Thompson is chairman of Vector Science & Therapeutics and a co-founder of LyoGenesis Plus.

The agreement calls for Vector to purchase the stake in LyoGenesis Plus over time for up to $1 million. The option is exercisable over a three-year period.

In addition, LyoGenesis Plus has entered into an agreement to acquire Mequon-based MPP Group LLC, an FDA-registered and cGMP (current good manufacturing practice regulations enforced by the FDA)-compliant contract development and manufacturing company.

So, if Vector exercises its option in its entirety it would have 15% ownership interest in MPP, which operates a 35,000-square-foot facility in Mequon. Vector’s option would give it an ownership stake in that infrastructure, through LyoGenesis, without having to build a comparable facility.

Vector and MPP plan to jointly develop shelf-stable peptide formulations with a target stability of up to 24 months, including 14 peptides recently removed from the FDA Category 2 list, which includes substances deemed to have significant safety risks and are restricted from routine use.

LyoGenesis Plus also has a $2 million equipment line of credit and a $1 million accounts receivable facility, giving Vector access to expansion capital.

“Ownership of an FDA-registered, cGMP manufacturing facility is foundational for any company serious about delivering pharmaceutical-grade therapeutics,” said Thompson, who is also former U.S. Secretary of Health and Human Services. “This option gives Vector a credible, long-term manufacturing platform from which to build its peptide portfolio and deliver pharmaceutical-grade products to physicians.”

“Controlling our manufacturing platform is critical to our long-term success in the peptide market,” said Bill Jackson, chief executive officer of Vector Science & Therapeutics. “LyoGenesis Plus and MPP give us a pharmaceutical-grade foundation — not research-grade — from which to supply physicians with novel, shelf-stable peptide formulations as that $80.8 billion market continues to grow.”

Thompson and Jackson are co-founders of LyoGenesis Plus and are minority owners of the business, together holding less than 50% of its equity, according to a news release. They both recused themselves from the Vector board of directors before the vote to approve the transaction with LyoGenesis, the news release said.