ImmunoGen Inc. received a commitment worth at least $62 million from Aventis SA, which in turn acquired a large share of ImmunoGen's pipeline as part of an agreement to jointly develop antibody-based cancer products. And the deal could get sweeter from there.
"They drove this process and came to us to fulfill a need they had after making a strategic decision to move into antibodies for cancer," ImmunoGen Chairman and CEO Mitchel Sayare told BioWorld Today. "They needed help in establishing a presence and expertise in antibodies, so they evaluated a number of companies and decided to do it with us."
The Cambridge, Mass.-based company will receive a $12 million up-front payment and more than $50 million in committed research funding over a three-year period. If Aventis exercises an option to extend the collaboration by one or two years, the committed funding increases to $99 million.
However, milestones could take the deal even higher - each product being brought through the clinical pipeline by the companies could bring ImmunoGen milestone payments totaling between $20 million and $30 million, as well as royalties on commercial sales. ImmunoGen also retains an option to certain co-promotion rights in the U.S. on a product-by-product basis.
ImmunoGen's stock (NASDAQ:IMGN) climbed $1.84 Thursday, or 49.2 percent, to close at $5.58.
"A major collaboration with a marquee pharmaceutical company always provides a certain degree of technology validation of the platform of the smaller biotech company," Yaron Werber, an analyst with SG Cowen Securities Corp. in New York, wrote in a research report. He also noted that the funding provided through the agreement would further reduce ImmunoGen's $20 million cash burn for this year relative to its cash position of about $110 million as of June 30.
Both parties will provide targets for the product development part of the collaboration, while Aventis will cover all costs associated with development, manufacturing and commercialization. The Strasbourg, France-based company gained worldwide rights to any products developed from the agreement, as well as three preclinical antibody-based cancer candidates.
"We've demonstrated that we can bring products from target stage through to the clinic," Sayare said. "Their existing expertise is very much downstream from that for macromolecules and monoclonal antibodies. What they don't have is what we can do - translate a surface target on a cancer cell into an antibody-based product that would jump right into their system."
Among the three products licensed to Aventis, the most advanced is huMy-9-6-DM-1, a compound for acute myeloid leukemia for which ImmunoGen had planned to file an investigational new drug application before next spring. Sayare said the other potential therapeutics include an IGF-1 receptor-directed naked antibody that has shown promise in treating solid tumors including breast, lung and prostate cancers, as well as a non-Hodgkin's lymphoma product developed from ImmunoGen's Tumor-Activated Prodrug (TAP) technology.
"This deal covers the costs of development of the three products we licensed to them, and then some, giving us lots of additional funds to go about developing other things in-house and broadening our interests," Sayare said. "In effect, they cover a substantial amount of our ongoing costs for product development."
For Aventis, the deal sets up an opportunity to increase its worldwide oncology stamp. Its cancer product portfolio already includes Taxotere, a chemotherapeutic agent that last year generated worldwide sales in excess of €1 billion, as well as several other marketed and investigational products.
Sayare said ImmunoGen's TAP technology allows it to develop two types of product candidates depending on the target. It can produce an immunoconjugate, which uses the antibody to deliver a cell-killing agent to the cancer cell, or a naked antibody, a product in which the antibody alone inhibits or kills the cancer cell.
Sayare said the technology includes a cytotoxic effector molecule covalently attached to a monoclonal antibody. The molecule remains inactive as long as it remains with the antibody, which eventually binds to a cancer cell surface, enters the cell and releases its payload.
Among its clinical-stage TAP products are cantuzumab mertansine and huN901-DM1 (BB-10901). The former had been partnered with London-based GlaxoSmithKline plc, though ImmunoGen now is looking for another partner, and the latter is licensed to Oxford, UK-based British Biotech plc in Europe and Japan. British Biotech reported Phase I data showing that the drug can be safely administered for small-cell lung cancer at doses comparable to those that produced antitumor activity in preclinical models. (See BioWorld Today, Jan. 27, 2003.)
Several other companies are developing products using ImmunoGen-licensed TAP technology, including MLN2704 from Millennium Pharmaceuticals Inc., also of Cambridge; bivatuzumab mertansine from Boehringer Ingelheim GmbH, of Ingelheim, Germany; and Trastuzumab-DM1 from Genentech Inc., of South San Francisco.
"There are a lot of early clinical data being generated internally and by our partners," Sayare said. "And we will continue our business model of outlicensing our payload technology for other companies to use."
While he noted that the upside of such deals would be realized in milestone and royalty payments in the $40 million range, the downside is that such products could never make it to market, meaning ImmunoGen would see less of a return.
"The Aventis deal provides us with a lot of protection against the ups and downs of timing," Sayare added. "We get the money quarterly, it's committed."