Bristol To Devote $125 Mil. To Develop Medarex' Metastatic Melanoma Agent
This article was originally published in The Pink Sheet Daily
Executive Summary
Bristol adds Phase III anti-CTLA-4 product MDX-010 to its franchise as several of its oncologics are exposed to generic competition. Medarex cites upside potential as a reason for entering into the collaboration with Bristol.
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Bristol-Myers Squibb will set aside $125 mil. to develop Medarex' Phase III metastatic melanoma agent under a collaboration agreement announced Nov. 8. Bristol and Medarex will devote a total of $192 mil. to co-develop MDX-010, an antibody that targets cytotoxic T lymphocyte antigen 4 to enhance immune response. The companies are splitting the development budget 65%/35% between Bristol and Medarex. The product is in Phase II for prostate, renal and breast cancers, and is also being studied in the treatment of HIV. Medarex has initiated enrollment of a pivotal Phase III trial to examine the anti-CTLA-4 product MDX-010 in combination with the cancer vaccine MDX-1379. MDX-010 has orphan drug status for Stage II, III and IV melanomas and has been granted fast track status. Additionally, FDA has granted the agent subpart E designation, which, like the subpart H accelerated approval mechanism for drugs, provides for special review for biologics to treat life-threatening and severely debilitating illnesses (1 (Also see "Medarex To Start Pivotal Trial Of MDX-010/Cancer Vaccine Combo For Melanoma" - Pink Sheet, 23 Aug, 2004.)). The pivotal trial is expected to be completed during the first half of 2006. Assuming the product is approved under the six-month review clock, the agent could be launched by late 2006 or early 2007. Under the development agreement, Bristol will pay Medarex $50 mil. in upfront payments. Of that, $25 mil. is a cash payment and $25 mil. is an investment in the biotech company through the purchase of 2.9 mil. shares of common stock at $8.68 (a 3.5% premium to the Nov. 5 closing price). Medarex said the collaboration would allow the company to maintain the upside potential of MDX-010 through milestone and royalty payments, and an option to share profits. The agreement grants Medarex the option to co-promote the agent with Bristol in the U.S (with Bristol training the Medarex sales force). If the company exercises the option, it would receive 45% of profits. Otherwise, Medarex would receive "substantial" royalties, the company said. Medarex will also receive up to $480 mil. in sales and regulatory milestone payments and royalty payments from sales outside the U.S. Medarex cited Bristol's experience launching Erbitux and developing CTLA-4 agents, such as abatacept, as one reason for entering into a partnership. Bristol intends to file a BLA for its selective T-cell co-stimulation modulator abatacept (CTLA4-Ig) for rheumatoid arthritis by year-end. The agreement gives Bristol an additional oncologic as both Taxol and Paraplatin are exposed to generic competition. Bristol said oncology would be one of the company's main therapeutic focuses, in addition to the cardiovascular and metabolic disease areas 2 (Also see "Primary Care Sales Force Downsizing Will Continue, Bristol Says" - Pink Sheet, 29 Jul, 2004.)). - Lee Kalowski |