Biogen Idec has agreed to enter into an exclusive partnership with Isis Pharmaceuticals to develop and commercialize Isis’ experimental antisense therapy for a rare spinal disorder in newborns. The collaboration, which could be worth as much as $299 million, provided Biogen decides to license the drug candidate.

Under the agreement, Isis will get $29 million in upfront cash and an additional $45 million for development costs. Biogen has the option to license the drug, known as ISIS-SMNRx, until the completion of the first successful mid-stage trial. If it does so, it will pay Isis up to $225 million in license fees and regulatory milestone payments. Isis will also receive doubt-digit royalties on sales if ISIS-SMNRx reaches market.

Spinal muscular atrophy is a genetic disease that affects an estimated one out of every 10,000 newborns, and causes severe muscle atrophy and weakness. The disease is caused by a faulty survival motor neuron gene which doesn’t produce enough of the SMN protein needed to maintain muscle strength.

The companies estimate that there are between 30,000 and 35,000 patients in the world, primarily found in the United States, Europe, and Japan. Children with the most severe type of the disease generally live no more than two years, while patients with the less severe forms of the disease have shortened life-spans and may never be able to function independently.

The partnership exemplifies “exactly the kind of disease and program that we are focused on,” said Biogen’s CEO George Scangos. “The unmet need could not be any greater, the program fits our mission to bring innovative therapies to patients with serious neurological diseases, and Isis’ compound has the potential to be a highly effective, first-to-market therapy for this deadly disease.”

Isis initiated the first early-stage single dose clinical study evaluating ISIS-SMN last month and hopes to progress into an early-stage ascending dose study in short order.