When it comes to Zenapax (daclizumab), the relationship between PDL BioPharma Inc. and partner Hoffmann-La Roche Inc. could be described as flexible, complex and ever-changing.

Nutley, N.J.-based Roche acquired worldwide rights to daclizumab in 1989, returned them - except in transplantation - in 2003, and then picked up co-development rights of a subcutaneous version for respiratory disorders in 2004.

Now, after two years, the pharmaceutical firm is dropping development in asthma, giving PDL all rights back, despite positive results in an earlier Phase II trial.

While the companies had anticipated starting another Phase II at the beginning of this year, the trial never made it past the planning stages, said Jean Suzuki, a spokeswoman for PDL.

With Roche's pull-out from the asthma program, PDL now holds exclusive development and commercial rights for the indication, but has said it will need to re-partner it in order to continue development.

"We are certainly evaluating different partnership opportunities, but at this time, we can't comment on any specific discussions that might be under way," Suzuki told BioWorld Today.

Roche's decision does not affect its ongoing collaboration with Fremont, Calif.-based PDL concerning the co-development of daclizumab in transplant maintenance. Roche picked up the transplant maintenance rights last fall in a deal worth $155 million. (See BioWorld Today, Nov. 2, 2005.)

"We're really excited about working with Roche to continue to move that program forward," Suzuki said. "We are in the process of working with them to develop a Phase II program" expected to start in 2007.

Roche said the decision to drop PDL's asthma program had more to do with its business than with the drug itself.

"It was most definitely a corporate decision," said Kim Cayz, a company spokeswoman. "Roche decided to terminate the agreement based on a very typical R&D portfolio review."

After looking at the development plan for daclizumab compared with other asthma compounds at similar stages of development at Roche, the company decided it would return the rights to PDL. Cayz could not say whether daclizumab was found to be less promising than Roche's other candidates.

PDL also has a separate agreement with Cambridge, Mass.-based Biogen Idec Inc. to develop daclizumab in multiple sclerosis and indications other than transplant and respiratory diseases. The deal, announced in August 2005, is worth a potential $800 million and includes rights to volociximab and fontolizumab for all indications. PDL is developing the compounds for solid tumors and moderate to severe Crohn's disease, respectively. (See BioWorld Today, Aug. 4, 2005.)

A Phase II study has been completed in the MS program, Suzuki said, "and those results will be available mid-to-late 2007."

The handing off between Roche and PDL of daclizumab rights began in 2003 when the product failed as a maintenance therapy in psoriasis. It also failed in Phase II trials in May 2004 for ulcerative colitis, but showed compelling Phase II data later that year in respiratory disorders. Just as Roche was backing off certain indications, PDL expressed an interest in gaining a stronger commercial presence with the product.

Zenapax in an intravenous form gained FDA approval in 1997 to prevent renal allograft rejection.

"We have had a very collaborative relationship with PDL for 17 years," Cayz told BioWorld Today, "and that is going to continue specifically within the transplant arena."

Other products in PDL's pipeline include Nuvion (visilizumab) for ulcerative colitis and Crohn's disease, ularitide for acute decompensated heart failure and terlipressin for Type I hepatorenal syndrome.

Nuvion is in a Phase II/III ulcerative colitis trial and Phase II studies in Crohn's disease, while ularitide also is in Phase II. Terlipressin, however, failed in a Phase III trial earlier this month, and its future development remains in question. (See BioWorld Today, Aug. 7, 2006.)

PDL also markets its own products, such as Cardene I.V. (nicardipine hydrochloride), a calcium channel blocker, and receives royalty revenues from South San Francisco-based Genentech Inc. cancer drugs Avastin (bevacizumab) and Herceptin (trastuzumab).

The company had cash, cash equivalents and marketable securities of $414.3 million as of June 30. For the second quarter, its revenues were $104.3 million, and it posted a GAAP net loss of $6.1 million, or 5 cents per share.

PDL's stock (NASDAQ:PDLI) climbed 17 cents Wednesday to close at $19.66.