By Randall Osborne

West Coast Editor

Plowing ahead with another deal for its Tumor-Activated Prodrug (TAP) method of delivering cytotoxic agents, ImmunoGen Inc. signed a five-year agreement with Millennium Pharmaceuticals Inc.

Both companies were closed Tuesday in snow-covered Cambridge, Mass., where they are based, but ImmunoGen Chairman and CEO Mitchel Sayare said Millennium is paying $2 million up front "to test our technology," and potentially more than $40 million in milestone payments per target.

"We consider it more or less an 'autopilot' deal," Sayare told BioWorld Today. "We get cash coming in without draining much in the way of resources" - which is all part of ImmunoGen's plan.

"Our business model dictates that the long-term return is generated by internal products, whose rights we hang onto, and not so much from royalty payments from our partners," he said.

TAP technology conjugates a small-molecule effector drug to a tumor-targeting monoclonal antibody. Although they are as much as 1,000 times more potent than conventional chemotherapy drugs, TAPs are nontoxic until they enter tumor cells, to which they are fatal.

Millennium will provide an up-front technology access fee, milestone payments per antigen target, and royalties, and will handle product development, manufacturing and marketing.

For a restricted, undisclosed number of antigen targets, Millennium gets an option for exclusive product licenses. ImmunoGen may supply material for preclinical and clinical work as part of the deal, which is renewable once, for three years.

ImmunoGen also has deals with Abgenix Inc., of Fremont, Calif., and a pair of agreements with Genentech Inc., of South San Francisco.

"The economic terms [of the Millennium deal] are better, but we're more mature, and the technology's been out there longer," Sayare said.

Jay Silverman, an analyst with Robertson Stephens Inc. in San Francisco, upgraded ImmunoGen's stock Tuesday to a "strong buy." ImmunoGen's stock (NASDAQ: IMGN) ended the day at $17.375, up $2.25, or 15 percent.

Eric Shen, a research analyst who works with Silverman, told BioWorld Today that ImmunoGen had been "talking about doing a deal with a genomics company for quite awhile. It seems like they're picking up more negotiating power."

He said "a lot of investors are waiting for human data, and we expect to have human efficacy data from Phase I/II studies at [the American Society of Clinical Oncology meeting] in May."

Those studies are with huC242-DM1/SB-408075, being tested for colorectal, pancreatic and some non-small-cell lung cancers. ImmunoGen's partner since February 1999 for that drug is UK-based GlaxoSmithKline plc (formerly SmithKline Beecham plc).

"Glaxo and Genentech highlighted TAP technology at their investors' meetings in February," Shen said. Sayare believes TAPs are just the solution for a vexing problem.

"The question is, 'What do you do with a naked antibody?'" he said. "Will naked antibodies be sufficient to have an impact on cancer? Genentech did the deal with us on Herceptin [its humanized anti-HER2 monoclonal antibody for breast cancer] because they thought the prospects could be improved by using the monoclonal antibody as a specific delivery vehicle for our agents. It's a different approach."

No other company is doing it, he added.

"Certainly, the radioisotopes are similar," Sayare said, and those work well for leukemia and lymphomas, "but we don't think they have much of a place in solid tumors."

As of Dec. 31, which was the end of ImmunoGen's second quarter, the company had $158 million in cash and marketable securities.

For its part, Millennium is awaiting word from the FDA on Campath (alemtuzumab), a monoclonal antibody for treatment of chronic lymphocytic leukemia patients who have been treated with alkylating agents and who have failed fludarabine therapy. Late last year, the agency's Oncologic Drugs Advisory Committee recommended approval of the drug, partnered with San Antonio-based Ilex Oncology Inc. (See BioWorld Today, Dec. 15, 2000.)

Millennium's stock (NASDAQ: MLNM) closed Tuesday at $33.25, down 43.75 cents. n