By Karen Pihl-Carey

LeukoSite Inc. and Ilex Oncology Inc. granted exclusive marketing and distribution rights for Campath to Schering AG.

Schering, of Berlin, will pay up to $30 million for the rights and the achievement of certain regulatory milestones. The three companies will share equally in the profits.

"It's a great deal," said Richard van den Broek, a senior analyst with Hambrecht and Quist LLC in New York. "They got a nice share of the back end so it's hard to argue with the success of that.

"It's good for LeukoSite," he told BioWorld Today. "It validates the end-licensing of this product. It puts LeukoSite on the map and in investors' eyes."

Campath, a potential new treatment option for patients with chronic lymphocytic leukemia (CLL), is in late-stage development and could be on the market early next year. LeukoSite, of Cambridge, Mass., and Ilex, of San Antonio, licensed the drug from London-based BTG plc. They expect to submit a completed biologics license application (BLA) with the FDA by December.

Campath is on a fast-track status, and two parts of the BLA already have been submitted. The FDA must finish its review within six months of the final submission, and the product will be launched shortly thereafter, said Ilex President and CEO Richard Love.

All three companies - LeukoSite, Ilex and Berlex Laboratories Inc., Schering's U.S. affiliate - have agreed not to disclose financial details breaking down how the $30 million will be paid. The payments, however, will be based on certain regulatory milestones in CLL and will help LeukoSite and Ilex fund research of the drug for other indications.

"In the U.S., Berlex, LeukoSite and Ilex will share equally in the profits of the sales of Campath," LeukoSite Chairman and CEO Christopher Mirabelli said. "More specifically, this means that LeukoSite and Ilex will each receive one-third of the profits on Campath sales. And outside the U.S., Schering again will pay royalties to the partnership equivalent to the rates of the profit sharing I just described in the U.S."

The agreement gives Schering the right to market Campath for all indications everywhere but Japan and East Asia, where LeukoSite and Ilex retain the rights.

"Japan and East Asia were not included in the deal as LeukoSite and Ilex determined that more time was needed to develop our marketing strategies for that part of the world," Love said. "CLL is not a significant problem or market opportunity in Asia at this time. However, T-cell malignancies are more prevalent in this population, so we're confident we ultimately will want to develop a market there for Campath."

Schering has an interest in Campath because the company already markets one of the leading drugs for patients with CLL, which affects about 120,000 people in the U.S. and Europe. The disease is an infiltration and accumulation of functionally immature lymphocytes, which may cause bone marrow dysfunction, and lymph node, liver and spleen enlargement.

Schering's fludarabine is a drug given to CLL patients when chemotherapy fails. If fludarabine fails, there is no other approved treatment and the patient has a life expectancy of six to nine months. But results from Phase II trials of Campath, a humanized monoclonal antibody targeted to the CD52 antigen, indicated that 33 percent of patients who did not respond to alkylating agents and fludarabine responded at least partially to Campath. (See BioWorld Today, June 15, 1999, p. 1.)

Testing will continue to find if Campath increases the remission rate, with results expected in early 2000, said Lee Brettman, senior vice president of clinical development for LeukoSite.

Upon approval of Campath, Berlex plans to promote the drug in the U.S. using 60 sales representatives working with 12 medical science liaisons, said Michael Quattro, vice president of marketing for Berlex.

"The addition of Campath to the portfolio establishes Berlex as the powerhouse in treating CLL, with two proven treatment options," Quattro said.

Campath also is being tested for use in other cancers, such as non-Hodgkin's lymphoma and T-cell leukemia, as well as in multiple sclerosis and organ transplantation.

"Why we're excited about this deal is it gives us the opportunity not just to work with Schering/Berlex as it relates to CLL, but all the other indications," Mirabelli told BioWorld Today. "Those trigger a whole different set of milestone payments as we develop the drug in those other indications." The overall profit sharing from sales for other indications would be the same as they are for CLL, Mirabelli said.

Brettman said Campath has shown "significant activity" in secondary progressive multiple sclerosis, with decreases in 90 percent of new inflammatory lesions. It also has shown promise in the area of renal transplantation. Leukosite's stock (NASDAQ:LKSI) fell $1.125 Tuesday to $21.25. ILEX (NASDAQ:ILXO gained $2.187, or 14 percent, to $17.687.