By Nuala Moran
BioWorld International Correspondent
London - British Biotech plc agreed to a deal with Schering-Plough Corp. for the development and commercialization of its oral anti-cancer drug, marimastat, and other matrix metalloproteinase inhibitors (MMPIs). The deal is worth up to $60 million, excluding royalties.
In return for exclusive rights to commercialize all MMPIs in any type of cancer, British Biotech will receive an up-front payment of $8 million, split between a license fee and equity investment, and could receive up to a further $52 million in milestone payments, depending on the results of Phase III trials of marimastat currently taking place. The royalty rate was not disclosed.
British Biotech's stock (NASDAQ:BBIOY) jumped for the second time in two weeks. It gained 38 percent Tuesday, or $1.828, to close at $6.625. It had gained 21 percent, up to $4.687, after the release Aug. 24 of mostly positive Phase III data on marimastat in gastric cancer.
British Biotech expects to spend $24 million on completing the current marimastat trial program, and said Schering-Plough has agreed to make substantial investments in the continued development of marimastat and other MMPIs.
"This agreement is designed so that the more successful the drug is, the more valuable it is to both parties," Elliot Goldstein, CEO of British Biotech, said in a teleconference call. "This is a long-term collaboration, not just a licensing deal on marimastat. Substantial investment in further development is just that. A large part of the investment will be in support of the clinical development of backup compounds."
The lead one of these is BB-3644, a second-generation MMPI that differs from marimastat by its ability to block tumor necrosis factor production. British Biotech has completed a Phase Ia study in healthy volunteers and has planned a dose-ranging Phase Ib in cancer patients.
The terms of the agreement exclude Japan, where marimastat is licensed to Tanabe Seiyaku Co Ltd., and where British Biotech is currently negotiating partnership rights to BB-3644.
Although British Biotech, which is based in Oxford, has handed over the complete cancer franchise, it retains the rights to develop MMPIs in other diseases. Goldstein said, "We will be pushing our research capability towards other indications. We have just about optimized MMPIs in cancer with BB-3644, so we will move laterally to indications such as inflammatory diseases."
Goldstein also noted the collaboration was "99 percent put to bed" before the partners knew of the positive results in a Phase III trial in gastric cancer published two weeks ago. "You can't design a deal around the coming in of particular results. This is a broad agreement around cancer in general."
The gastric cancer study did not meet its primary endpoint overall, but there was a striking survival benefit in a subgroup of patients whose tumors had not metastasized. Goldstein suggested the best market for MMPIs may be as an adjuvant treatment in patients who are relatively healthy and will take the drug over a long time.
Schering-Plough has assumed responsibility for any regulatory filings. Goldstein said that following the gastric cancer results the two partners are exploring how to proceed with regulatory authorities but the when and how still is being determined. He does not expect the deal to accelerate filing dates but added, "Schering's track record can only help us."
Goldstein said that since he joined British Biotech a year ago he has "removed the negative drivers from the business."
"Now we have ensured that MMPIs have found a good home, and that our investment in them is defined, the next steps will be to develop in-house capabilities to deliver one new compound per annum, and to bring in new compounds."
British Biotech shares (BBG) on the London Exchange gained 4.25 pence Tuesday, or 11.4 percent, to close at 41.50 pence. The stock had gained 6 pence Monday.