Cellcor Inc.'s shares shed 42 percent of their value on Thursday after the developer of living cell therapies said it had dropped negotiations on a joint marketing agreement with Critical Care America (CCA), a network of infusion of clinics.
Cellcor of Newton, Mass., and CCA last January signed a letter of intent to jointly market and deliver on a pilot basis Cellcor's autolymphocyte therapy (ALT) for treating renal cell carcinoma at three CCA outpatient care centers. The two companies also planned to explore joint development and marketing of Cellcor's proposed ALT for HIV-infected patients.
Cellcor said it is pursuing alternative marketing strategies "to increase patient and physician access to the therapy." Its first commercial product, an ALT to treat metastatic renal cell carcinoma, has been used to treat more than 3,000 patients to date.
Cellcor's stock (NASDAQ:CLTX) on Thursday fell $3.75 a share to $5.25 on trading volume of 332,400 shares, or about 6 percent of its shares outstanding. The company made an initial public offering last March, selling more than 2 million shares at $11 each.
The anticipated synergy between Cellcor, which is developing techniques to treat a patient's own lymphocytes (white blood cells) with disease-fighting properties, and CCA, which could potentially offer infusion and other services to patients undergoing ALT treatment, failed to develop during eight months of talks, according to Cellcor.
"As discussions progressed, it became evident that ALT for kidney cancer did not fit with CCA's marketing and product development strategies," said Richard R. D'Antoni, Cellcor's president and chief executive officer. "In addition, the AIDS protocol, which would have been a key element of the potential collaboration, is still in preliminary stages."
"They were as interested in the AIDS part of the deal as the renal treatment," Harry W. Wilcox, Cellcor's chief financial officer, said Thursday. Proposed written protocols for the ALT treatment were prepared after the two companies reached a tentative agreement last winter.
Cellcor expects to manage on its own a small clinical study of ALT to treat HIV-infected people. It operates three outpatient cellular therapy centers connected with hospitals in Boston, Atlanta and Orange County, Calif. Cellcor has had discussions with most of the major infusion therapy networks, but it may now want to keep its options open, Wilcox said.
"We're opening up our distribution model," he said. "We don't want to limit ourselves to them (any one infusion therapy network) in any market." The parting with CCA was amicable, and Cellcor expects to work with CCA on individual cases in the future, he said
A 1990 study of Cellcor's ALT, published in the journal The Lancet, found that renal cell carcinoma patients treated with ALT survived an average of 2.5 times as long as a control group.
The company said its ALT is currently in three large Phase III clinical studies for renal cell carcinoma, including one sponsored by the National Cancer Institute that is comparing ALT to a drug therapy of interleukin-2 in combination with alpha interferon. Cellcor hopes to start later this year a clinical study of ALT to treat hepatitis B, Wilcox said.
For AIDS, Cellcor has proposed an ALT treatment that makes use of lymphocytes donated by tissue-matched siblings. An estimated 30 percent of HIV-infected individuals would have the needed sibling donors, the company said.
-- Ray Potter Senior Editor
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