By Kim Coghill

Washington Editor

The developer of Gliadel Wafer, a treatment for recurrent primary malignant brain cancer, said Tuesday it reacquired commercial rights to the biopolymer product.

Baltimore-based Guilford Pharmaceuticals Inc. repurchased the rights from Aventis Pharma, the pharmaceutical company of Aventis SA, in an agreement that gave Aventis 300,000 shares of Guilford common stock valued at about $8 million, based on Monday's closing price. Frankfurt, Germany-based Aventis will continue to sell Gliadel Wafer through the transition period ending Dec. 31.

Guilford's stock (NASDAQ:GLFD) closed Tuesday at $25.81, down 81 cents. Aventis' stock (NYSE:AVE) closed Tuesday at $69.87, up 75 cents.

Since 1996, Gliadel Wafer has generated more than $60 million for Guilford in sales (largely U.S.), equity investments and milestone payments, according to Stacey Jurchison, Guilford's director of communications. In 1999, worldwide sales were $16.3 million.

Gliadel Wafer delivers chemotherapy directly to the site of a brain tumor, minimizing drug exposure to other areas of the body. The product is a small, white dime-sized wafer comprised of biodegradable polymer incorporating the chemotherapeutic agent, BCNU (carmustine).

Up to eight wafers can be implanted in the cavity created when a surgeon removes a brain tumor. There, the wafers slowly erode, releasing BCNU directly at the tumor site in high concentrations.

Gliadel Wafer was commercially launched in 1997, several months after Guilford and Aventis entered their marketing and distribution agreement. (The agreement excludes Scandinavia, where the product is marketed by Orion Pharma.)

"At the time of the agreement Guilford was a much smaller organization," Jurchison said. "We didn't have the means or infrastructure to support marketing and sales activities."

Before Tuesday's announcement, Guilford received about 35 percent of the gross revenues for Gliadel Wafer, and "in reacquiring the product we have an opportunity to increase our top-line revenues and it will provide additional cash flow to support our ongoing programs," Jurchison said.

Specifically, Guilford in June completed Phase III trials of Gliadel Wafer used to treat brain cancer at the time of diagnosis. Data on the trials will be released next month and the company anticipates filing a supplemental new drug application in mid-2001.

Gliadel Wafer's approval by the FDA in 1997 was based on a study involving 222 patients undergoing surgery for recurrent glioblastoma multiforme. In the Phase III double-blind, placebo-controlled clinical study, Gliadel Wafer increased survival at six months by more than 50 percent.

In a second randomized, double-blind, placebo-controlled Phase III clinical study in 32 patients newly diagnosed with malignant glioma, Gliadel Wafer increased survival at one year to 63 percent compared to 19 percent with placebo.