BioWorld Today Correspondent

LONDON – Chroma Therapeutics has forged a collaboration with Cell Therapeutics Inc., in which the two companies will co-develop Chroma's tosedostat, an orally available cancer treatment.

The deal paves the way for Phase III trials of the product, which has FDA and European Medicine's Agency Orphan Drug status in relapsed or refractory acute myeloid leukemia (AML), to start later this year.

In return for commercialization rights in the Americas, Cell Therapeutics is making a $5 million up-front payment to Oxford, UK-based Chroma, and will pay a further $5 million when the Phase III study begins. The deal includes further development milestones and royalties in AML, myelodysplastic syndrome and other, unspecified, cancers.

The two companies said they will now spend up to $50 million over the next three years on the development of tosedostat, with Seattle-based Cell Therapeutics bearing 75 percent of the costs and Chroma the remaining 25 percent.

The agreement is good news also for Vernalis plc, of Winnersh, UK, which licensed tosedostat to Chroma in November 2003, and is entitled to a share of any sales royalties.

James Bianco, CEO of Cell Therapeutics, explained during a teleconference the company has been looking for an additional product, and tosedostat, "not only meets, but exceeds this goal." The product is a late-stage opportunity addressing unmet medical need in a large market. In addition, tosedostat is an oral treatment suitable for long-term administration and has shown synergy with marketed products.

Bianco said his attention was first drawn to tosedostat in October 2010 when data from the Phase I/II trial in AML was published. That highlighted a "quite impressive" side effect profile and a notable 27.5 percent overall response rate in a very sick patient population.

Tosedostat is an inhibitor of aminopeptidases, a family of intracellular enzymes involved in generating amino acids that are essential for cell growth. While inhibition of aminopeptidases halts cell growth and causes apoptosis in cancer cell lines, normal cells are not affected.

Ian Nicholson, CEO of Chroma, said while the precise mechanism of action is unclear, it appears that cancer cells are unable to access the extracellular amino acid pool in the way that healthy cells can.

"This results in a differential effect, and normal, healthy cells are not affected," he said.

Tosedostat is a first-in-class agent, and Nicholson said he is not aware of any products in development with a similar mechanism of action. Although there are a number of drugs in development for AML and registered treatments, those are cytotoxic drugs with a less favorable side effect profiles.

Bianco said the deal has been structured to capitalize on the relative strengths of each partner. Although Chroma is a privately held company, the people running it have experience of managing public biotechs and backgrounds in big pharma, and that "enhances" the partnership Bianco said.

There will be joint governance of the onward development of tosedostat, with the intention of advancing it through to approval in the U.S. and Europe in parallel.

Chroma has raised £61.5 million (US$99.5 million) from U.S. and European investors since its formation in 2001, most recently raising £15 million in June 2009, when it also signed a collaboration with a headline value of $1 billion with GlaxoSmithKline plc.