By Randall Osborne

Centocor Inc. entered a marketing agreement worth up to $50 million with Schering-Plough Corp. for Avakine (infliximab), a monoclonal antibody for Crohn's disease and rheumatoid arthritis.

"We waited for the right partner and the right deal," said Bill Newbould, manager of investor relations for Malvern, Pa.-based Centocor, which saw its stock drop 17 percent in December when the company failed to meet its goal of signing a marketing partner by year's end. (See BioWorld Today, Dec. 31, 1997, p. 1.)

Under terms of the agreement, Centocor gets $20 million up front and up to $30 million in milestone payments.

"They're tied to international [marketing] approvals, primarily European," Newbould told BioWorld Today.

Also last December, Centocor submitted a biologics license application for Avakine against acute, moderate to severe Crohn's disease, an inflammatory bowel disorder, to the FDA, which has accepted it for priority review. Included in the BLA is fistulized Crohn's disease, which is a more serious form.

This year, Centocor will begin a Phase III trial in chronic patients. "We're looking at the narrower end of the spectrum first," Newbould said.

Crohn's fistulae can form "channels that work their way from the bowel out to the skin," Newbould said. "It's very painful, and they can become infected." Data from two Phase III studies showed Avakine maintained remission in Crohn's disease patients and helped heal fistulae in two-thirds of them.

In March, the company filed a marketing authorization application for the same indication to the European Medicines Evaluation Agency.

The marketing deal with Schering-Plough excludes Japan and portions of the Far East -- where Centocor previously granted marketing rights to Tanabe Seiyaku Co. Ltd., of Osaka, Japan -- and the United States, where Centocor will sell Avakine.

Centocor and Schering-Plough, of Madison, N.J., will divide profits related to Avakine and will share certain internal and external development expenses.

Rheumatoid Arthritis The Larger Market

Avakine has been studied for rheumatoid arthritis in several Phase I/II studies, and a Phase III trial is ongoing.

"The last patient visit will be in August, and we should have data in the fall," Newbould said.

Of the two indications, rheumatoid arthritis patients are expected to provide the larger market.

Eric Schmidt, an analyst with UBS Securities, of New York, predicted a launch of Avakine in the U.S. in the fourth quarter of this year and in Europe next year.

"Schering believes Avakine will have marketing synergy with its own IL-10 [interleukin-10] product, a drug currently in early stage development for both moderate to severe Crohn's disease and rheumatoid arthritis," Schmidt wrote in his report.

IL-10 is a cytokine involved in suppressing the immune system's inflammatory response. In 1993, Schering was granted a patent for manufacturing it. (See BioWorld Today, July 28, 1993, p. 3.)

Centocor's stock (NASDAQ:CNTO) closed Monday at $44.125 up $1.125. *

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