By Lisa Seachrist

Washington Editor

In a move to accelerate the development of its anti-rejection drug Zenapax into autoimmune indications, Protein Design Labs Inc. has renegotiated its deal with marketing partner Hoffmann-La Roche Inc.

Under the terms of the agreement, PDL will assume worldwide responsibility for the clinical development of Zenapax in autoimmune diseases. In return, Mountain View, Calif.-based PDL will receive a reported 60 percent of all sales of the drug for autoimmune indications in the U.S. and Canada beginning in January 2000. The drug, a humanized antibody used to prevent acute rejection of transplanted kidneys, hasn't yet been approved for any autoimmune indications.

"We believe this is a very big deal for PDL," said Jon Saxe, former PDL president and a member of the board. "We've been trying very hard to get this deal because we thought Zenapax has significant potential and it lends itself to the treatment of chronic ailments."

Even though PDL will assume all clinical development of the drug, Nutley, N.J.-based Roche will supply certain quantities of Zenapax at no cost to PDL for use in clinical studies and PDL will be able to purchase additional quantities it needs.

The deal calls for PDL to have the responsibility to market, promote and detail Zenapax in autoimmune indications in the U.S. and Canada. Outside the U.S. and Canada, Roche may elect to market Zenapax in autoimmune indications. In that case, PDL would receive a substantial but still undecided portion of Zenapax revenues. Should Roche decide not to market in a certain country, PDL will receive an exclusive license to market Zenapax and will pay Roche a small royalty.

"Right now, any revenue we will receive [from autoimmune indications] comes from off-label uses," Saxe said.

Susan Light, senior medical director at PDL, will lead the autoimmune indication development program. Light directed the clinical development program of Zenapax at Roche after that company licensed the rights to Zenapax from PDL in 1989.

Zenapax is a humanized antibody aimed at the interleukin-2 receptor on activated T cells. By targeting activated T cells, Zenapax doesn't trigger the generalized immunosuppression that causes cancer and infections like other drugs used to prevent organ rejection. As a result, PDL views Zenapax as an ideal candidate for treating chronic autoimmune diseases.

Saxe said the company likely will pursue indications in moderate to severe psoriasis and noninfectious inflammatory uveitis first. In June researchers at the National Eye Institute in Bethesda, Md., reported 10 uveitis patients were able to come off their immunosuppressive drugs with monthly infusions of Zenapax. Currently, Zenapax exists only as a intravenous formulation. Saxe said the company will be looking into developing a formulation that may be given by subcutaneous injection.

In addition to uveitis and psoriasis, Roche had a clinical trial in tropical spastic paraparesis (a clinical model of multiple sclerosis). PDL likely will move forward into multiple sclerosis once a subcutaneous formulation exists.

PDL's stock (NASDAQ:PDLI) gained $1.156 Monday to close at $40.25.