West Coast Editor

Facing patent expiration for its top-selling drug next year, the Japanese firm Astellas Pharma Inc. is buying out Agensys Inc. for $387 million up front (assuming about $30 million net cash at closing), with potentially $150 million more in milestone payments.

Antibody-based deals originating on both sides of the pond made headlines. Separately, Los Angeles-based ImmunoCellular Therapeutics Ltd. (IMUC) disclosed its binding agreement to acquire all of the monoclonal antibody technology owned by Molecular Discoveries LLC.

"There are a lot of big pharmas investing in these [MAb] companies, particularly if they have an attractive platform technology," noted John Yu, chairman of Los Angeles-based IMUC. "Now it's a $6 billion industry, and I think Wall Street has finally seen its benefit."

The takeover of Agensys, of Santa Monica, Calif., by Tokyo-based Astellas brings aboard the lead candidate AGS-PSCA, an MAb targeting prostate stem cell antigen that was the subject of a potential $170 million deal from 2005 with Merck & Co. Inc., of Whitehouse Station, N.J. Generated with Thousand Oaks, Calif.-based Amgen Inc.'s XenoMouse technology, the fully human IgG1k product has yielded encouraging results in Phase I trials. (See BioWorld Today, Oct. 18, 2005.)

And for Astellas, there's plenty more in cancer. By applying differential gene expression technology to human tissues, Agensys has identified 30 proprietary targets in 14 cancer types.

Along with GMP manufacturing facilities, the company has 12 antibody programs in its pipeline, and aims to file an investigational new drug application this year for AGS-16M18, a fully human antibody to the proprietary target AGS-16, expressed in more than 90 percent of kidney-cancer patients.

Astellas' Prograf (tacrolimus), a twice-a-day immunotherapy for transplant patients, not only loses patent protection next year but has a challenger in the form of once-per-day LCP-Tarco (tacrolimus) from LifeCycle Pharma AS, of Horsholm, Denmark, which said in October that interim results of a Phase II trial showed the product superior. Top-line data are due from the study by early 2008.

Agensys at the start of this year entered a deal with Seattle Genetics, of Bothell, Wash., to develop four antibody-drug conjugate products that combine Agensys targets and fully human antibodies with Seattle Genetics' linker and toxin technology. Work has begun on the first anticancer product, which targets AGS-5. (See BioWorld Today, Jan. 9, 2007.)

On closing the takeover, a newly established subsidiary of Astellas US Holding Inc. will be merged into Agensys, which will become a wholly owned subsidiary. The deal is subject to Agensys shareholder and customary regulatory approvals, but is expected to take place by the end of December.

Terms of the ImmunoCellular deal with Molecular Discoveries call for the former to issue 800,000 shares of common stock and reimburse MD and one of its principals for patent expenses related to the acquired technology, which consists of a platform called Differential Immunization for Antibody and Antigen Discovery, as well as candidates for the potential detection and treatment of multiple myeloma, colon, small-cell lung, pancreatic and ovarian cancers.

ImmunoCellular's stock (OTC BB:IMUC) closed Tuesday at 95 cents, unchanged. "There's about $225,000 in cash" also changing hands in the deal, Yu told BioWorld Today.

The MAbs in the arrangement, expected to close in about 60 days, are covered by five issued patents and pending patent applications in the fields of multiple myeloma, colon, small-cell lung, pancreatic and ovarian cancers.

Yu called DIAAD "a very powerful platform to identify cryptic antigens, unique to cancer cells. Essentially, you immunize an animal with a normal prostate cell, for instance, and then you put in a cancer cell, and the antibodies are made against the cancer cell." The approach complements IMUC's dendritic cell vaccination strategy.

Cohava Gelber, chief science and technology officer of the American Type Culture Collection, invented DIAAD. "She's a very prolific scientist, and has been developing and working on it at a preclinical level," Yu said, adding that the deal has been in the works for about eight months.

IMUC hopes to enter the clinic in about two years, and aims to develop a diagnostic/prognostic product for SCLC and pancreatic cancers with a therapy for those indications as well.