BioWorld International Correspondent

LONDON - Celltech Group plc said it has narrowed the field of prospective partners for its rheumatoid arthritis treatment from 20 to four and will sign a deal before the end of June.

The short-listed four currently are carrying out due diligence on the anti-TNF-alpha antibody CDP 870, which was formerly partnered with Pfizer Inc. Results of the first Phase III trial, in combination with methotrexate, are due by the end of the month.

"We have had very substantial interest from potential partners," said Goran Ando, CEO, speaking at Celltech's 2003 financial results meeting last week. "They will get to see early results of the [Phase III combination] trial. We continue to be on track and look for a partnership to be announced in the next quarter."

Results of a Phase III monotherapy study are due in the second half of 2004, and a further trial - to assess the impact of CDP 870 on disease progression - will start after Slough-based Celltech has signed a partner. Ando said the new drug application filing would be in 2006 in the U.S. and Europe. "We anticipate our partner to have some views on the design of the trials, but this won't change the timeline."

Celltech shares rose 12 percent to £4.64 after the company said the CDP 870 deal was imminent.

CDP 870 also is in a Phase III trial in Crohn's disease, with a filing expected in 2005. Celltech's existing strategy is to market CDP 870 in Crohn's using its existing U.S. and European sales forces. However, Ando said he is open to persuasion from the potential partners to include Crohn's disease in the rheumatoid arthritis deal.

"We are in it not for an ego trip, we are in it to create value, and if that value is created better together, we'll go that way," Ando said.

Ando expects the new partnership to be at least equivalent in value to the previous one with Pfizer. That potential $280 million deal ended in December after Celltech declined a request from Pfizer to renegotiate the terms.

Ando also confirmed that Celltech is expanding the development of CDP 870 into other diseases, including psoriasis and ankylosing spondylitis, that it had no rights to under the Pfizer collaboration. Phase II studies in new indications will start in the next 12 months.

Celltech announced other developments in its drug pipeline, including progress with CDP 323, a small-molecule, orally administered, alpha-4 integrins inhibitor. That hits the same target as the first-in-class product Antegren, being developed jointly by Elan Corp. plc, of Dublin, Ireland, and Biogen Idec Inc., of Cambridge, Mass. Last month the two said they were filing for FDA approval of Antegren in multiple sclerosis one year into a two-year clinical trial. Antegren has been shown also to be active in irritable bowel syndrome and an investigational new drug application has been filed in RA.

"We are very encouraged by this progress," Ando said. "We have moved CDP 323 to Phase I and there are no early safety signs. We expect to start Phase II patient trials [in RA] in the second half of this year."

Celltech also made a £7 million (US$12.6 million) write down of its interest in NeoGenesis Pharmaceuticals, of Cambridge, Mass. Celltech invested $10 million in July 2001 when it signed up for NeoGenesis' high-throughput screening services. Celltech said the service was satisfactory but it was writing down the equity investment to reflect its value in the event of a trade sale of NeoGenesis. Celltech also wrote off a further £4.3 million of shares in NeoGenesis acquired through its purchase last year of Oxford GlycoSciences plc.

In the year to December 2003, Celltech's turnover was £353 million, up from £329.6 million in 2002. The cash pile grew from £105.1 million to £155 million.