A few months after partnering a preclinical program with Serono SA, antibody development company Genmab A/S entered a potential $215 million deal with the Swiss biotech firm involving its Phase III candidate to treat cutaneous T-cell lymphoma.

Copenhagen, Denmark-based Genmab granted Serono exclusive worldwide rights to develop and commercialize HuMax-CD4, a fully human monoclonal antibody that was granted fast-track status by the FDA and designated as an orphan drug in both the U.S. and Europe.

This deal "is really important in terms of maximizing the value of HuMax-CD4," said Genmab CEO Lisa Drakeman. "And it will allow us to hand off development costs so we can take those resources and start applying them to some of our other products."

Genmab expects to get an initial $70 million payment, comprised of a $20 million license fee and a $50 million equity investment, which the company will use to develop other products in its pipeline. Regulatory and sales milestones could bring in up to an additional $145 million, and Genmab also would be entitled to receive royalties on global sales of the product. Drakeman has estimated that the U.S. market alone for a T-cell lymphoma drug could be in the multi-100-million-dollar range.

The equity investment will involve the direct placement of about 2.5 million new bearer shares to Serono at DKK121.39 (US$19.83) per share, representing an 18 percent premium to the average market price of Genmab's share over the 20 trading days before the agreement was signed.

Following the placement, Serono will own about 7.6 percent of the company.

Genmab's shares, listed on the Copenhagen Stock Exchange under the symbol "GEN," gained 11 percent Thursday, closing at DKK113, up DKK11.

Serono, with an established dermatology sales force in Europe, seemed the optimal partner for HuMax-CD4, in development to treat a form of cancer that appears on the skin, Drakeman said.

"They have the right sales force, an efficient marketing strategy for niche products, the manufacturing capability and a track record for being a good partner," she said. Plus, the companies already are working together on another program.

In May, Genmab and Basel, Switzerland-based Serono agreed to collaborate on HuMax-TAC, a preclinical program aimed at organ transplant rejection and T-cell-mediated disorders. In that deal, Serono gained exclusive worldwide rights and agreed to cover development costs, while Genmab is eligible to receive up to $40 million in up-front and milestone payments, in addition to royalties. (See BioWorld International, May 4, 2005.)

HuMax-CD4 (zanolimumab) is being evaluated in a pivotal trial under a special protocol assessment from the FDA. Regulatory filing is expected next year, "and we hope to have the product on the market around the middle of 2007," Drakeman told BioWorld Today. "Patients really need an alternative. There's just so little available for them, and there's nothing that really blocks the progress of the disease."

Cutaneous T-cell lymphoma (CTCL), characterized by an accumulation of malignant T cells in the skin that can develop into rashes and tumors, results from uncontrolled growth of abnormal T lymphocytes. HuMax-CD4 is designed to work by targeting the CD4, a receptor that appears only on T cells.

Genmab secured all the rights to HuMax-CD4 in late June when it agreed to pay Princeton, N.J.-based Medarex Inc. $14.5 million for the European and Asian rights for the use of UltiMAb to create antibodies targeting the CD4 antigen. Genmab previously held rights to the CD4 target in North America, South America and a handful of other territories. (See BioWorld Today, July 1, 2005.)

Since it spun out of Medarex in 1999, Genmab has built up a clinical pipeline of five products, with about 10 other candidates undergoing preclinical development. The company is working with Medarex on one of those programs, HuMax-Inflam, which demonstrated positive results following a Phase I/II trial late last year in patients suffering inflammatory conditions.

Under an agreement with Thousand Oaks, Calif.-based Amgen Inc., Genmab is developing AMG 714, formerly HuMax-IL15, which is in Phase II development in rheumatoid arthritis.

On its own, the company is heading into Phase II trials with HuMax-CD20 in rheumatoid arthritis. That product recently completed a Phase I study in B-cell chronic lymphocytic leukemia. Another product, HuMax-EGFr, is in early clinical studies as a treatment for head and neck cancer. Genmab's preclinical programs include antibodies to treat hepatitis C infection and multiple myeloma.

For Serono, the collaboration with Genmab adds a fourth clinical-stage product to its growing oncology pipeline, which also includes Canvaxin, in Phase III development to treat Stage III melanoma. Serono obtained rights to Canvaxin from Carlsbad, Calif.-based CancerVax Corp.

Serono also is developing TACI-Ig with Seattle-based ZymoGenetics Inc. for the treatment of relapsed or refractory B-cell malignancies and multiple myeloma, and adecatumumab, partnered with Micromet AG, of Munich, Germany, in multiple myeloma and prostate cancer.

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