By Matthew Willett

Millennium Pharmaceuticals Inc. and Protein Design Labs Inc. entered an agreement that gives Millennium options to take commercial licenses for humanized antibodies protected by PDL's antibody humanization patents.

The agreement calls for Millennium to make an undisclosed signing fee and pay royalties on net sales of resulting monoclonal antibody (MAb) products. Millennium can acquire commercial licenses for up to three products for five years, and the option period can be extended for two years for an additional fee.

Millennium said the deal is the latest in its efforts to put together an all-encompassing toolkit for monoclonal antibody production. For PDL, the deal represents a further marketing of its revenue-generating antibody production capabilities and intellectual property portfolio.

John Maraganore, Millennium's senior vice president in charge of strategic product development, told BioWorld Today the PDL technology won't be the last element of Millennium's MAb program.

"It's part of what we've been very focused on doing lately," Maraganore said. "We're building the most complete toolkit available in the industry for the development of monoclonal antibody drugs."

In addition to the PDL deal, Millennium has deals with ImmunoGen Inc., of Cambridge, Mass., for access to TAP (tumor activated prodrug) technology, and Abgenix Inc., of Fremont, Calif., for access to that company's transgenic MAb production technology, the XenoMouse, Maraganore said. (See BioWorld Today, March 7, 2001, and March 8, 2000.)

He added that Millennium has also allied with MedImmune Inc., of Gaithersburg, Md., for its transgenic MAb production technology and with MorphoSys AG, of Martinsried, Germany, for phage display technology.

"We've got a vigorous process of looking for new technology, not only in small molecules but also in antibodies," Maraganore said. "It's a continuing process. It doesn't really end as long as there's good technology out there."

PDL's vice president of business development, Bob Kirkland, said PDL isn't looking at endings, either.

"PDL believes that humanized antibodies will continue to be very important therapeutics under development," Kirkland said. "As new humanized antibodies move from preclinical to clinical exploration we'll continue to sign new license agreements, either patent license agreements or straight patent right agreements, until we've licensed the majority of all our humanized antibodies in clinical development."

The deal with Millennium is the fifth of its kind for PDL. Among those deals are alliances with Genentech Inc., of South San Francisco, and Celltech Group plc, of Slough, UK.

PDL gets royalty revenue from sales of Synagis (palivizumab), a therapy for preventing respiratory syncytial virus (RSV) in children and infants, from MedImmune. It also takes a royalty stream from Herceptin (trastuzumab), a humanized anti-HER2 monoclonal antibody for breast cancer, from Genentech, and Zenapax (daclizumab), a humanized antibody aimed at the interleukin-2 receptor on activated T cells, created by PDL and licensed to Hoffmann-La Roche Inc., of Nutley, N.J.

PDL also gets royalties from sales of Mylotarg (gemtuzumab ozogamicin for injection), for the treatment of patients 60 years and older in first relapse with CD33-positive acute myeloid leukemia (AML) who are not considered candidates for cytotoxic chemotherapy, from American Home Products Corp., of Madison, N.J.

PDL's FDA-approved licensed antibodies had combined sales of more than $700 million in 2000.

And although PDL's balance sheet won't suffer from the up-front fee Millennium will pony up, Kirkland said the deal fits into the company's long-term revenue plans.

"Clearly, it's nice to have a significant signing fee to receive as revenue in this quarter, but in the long term PDL believes the royalty revenue from the sale of human antigens is the biggest contribution to its future," he said. "We're already getting royalty revenue on the sale of four antibodies, and we're looking for an expansion of that royalty revenue as additional humanized antibodies get approved and marketed."

Millennium's shares (NASDAQ:MLNM) gained $1.50 Tuesday to close at $26.687. PDL's shares (NASDAQ:PDLI) rose $2.937 on the news to close at $41.937. n