By Lisa Seachrist
WASHINGTON — Coulter Pharmaceutical Inc., has inked a deal with SmithKline Beecham to jointly commercialize Coulter's lead product, Bexxar, a radioactive monoclonal antibody therapy to treat non-Hodgkin's lymphoma.
The deal, which is potentially worth $132 million to Coulter, plus profits and royalties, calls for SmithKline and the Palo Alto, Calif.-based biotech to jointly market Bexxar in the United States. SmithKline has worldwide marketing and distribution rights, with the exception of Japan.
"We are very pleased with this deal," said Michael Bigham, president and CEO of Coulter. "It allows us to play an active role in the sales and marketing in the United States, and SmithKline is recognized as being a world-class leader in the oncology business."
Under the terms of the agreement, London-based SmithKline will make an up-front payment to Coulter of $41.5 million. Of that up-front payment, $7.25 million is in the form of an equity investment in Coulter. In addition, SmithKline is providing a $15 million line of credit to the company. The companies will equally share profits in the U.S. Coulter will receive royalties from sales elsewhere.
Pending the completion of regulatory and marketing milestones in the other countries, Coulter could receive an additional $76 million. The companies will equally share development expenses for Bexxar in the U.S., with Coulter funding a certain undisclosed portion of that development on its own. Outside the United States with the exception of Japan, SmithKline will fund all development costs.
Bigham said that any postmarket trials will be funded on a 50-50 basis if the research supports only U.S. indications. SmithKline will cover a higher percentage of the costs if the trial supports commercialization in other countries as well as in the U.S.
Non-Hodgkin's lymphoma (NHL) is a B cell-specific cancer. It is the sixth leading cause of death among cancers in the U.S. and has the second-fastest-growing mortality rate. In addition, the incidence of the disease is increasing.
About 270,000 people suffer from NHL in the U.S. and some 140,000 have low-grade or transformed low-grade disease, which is the initial indication for Bexxar.
"NHL is an insidious disease, and, unfortunately, it is on the rise," Bigham said. "And the medical community doesn't know why."
Bexxar is an antibody specific to the CD20 antigen on B cells which is conjugated to radioactive iodine 131. CD20 is only found on B cells, including NHL B cells and normal B cells. By targeting the B cell, Coulter hopes to deliver a much greater concentration of deadly radiation to tumor cells as compared to normal tissue.
The company has completed its pivotal trials of Bexxar and intends to file a biologics license application within the next couple of months. Bigham said he expects that Bexxar will utilize a rolling application process. The company is aiming to have the treatment approved by the end of 1999.
In addition, SmithKline also will have access to second-generation anti-CD20 compounds. Those products are still in the very earliest stages of development.
"Partly, that just represents a philosophy we have," Bigham said. "One should never become complacent when dealing with a life-threatening condition like cancer. And until all cancer patients can be cured with minimal side effects, hopefully there is another way to treat them that can be developed."
Coulter also is developing Bexxar for other B-cell diseases, such as chronic lymphocytic leukemia and intermediate-grade lymphoma. In addition to Bexxar, the company is developing a tumor-activated peptide pro-drug version of doxorubicin to treat solid tumors.
Coulter's stock (NASDAQ:CLTR) closed Friday at $31.03125, up $2.4062. *