By Randall Osborne

In a quest to develop a sustained-release formulation of the blood-booster erythropoietin (EPO), Alkermes Inc. made its third and largest deal — potentially worth more than $30 million — with Johnson & Johnson (J&J).

The latest collaboration, with New Brunswick, N.J.-based Johnson & Johnson's R.W. Johnson Pharmaceutical Research Institute, seeks to apply Alkermes' ProLease protein drug delivery system to EPO, so that a single injection would last several weeks.

In exchange for worldwide rights to any products developed, Johnson & Johnson will pay development costs and provide milestone payments to Alkermes, of Cambridge, Mass., along with royalties.

"Generally, in our ProLease deals, we don't ask for up-front payments," said Michael Landine, CFO of Alkermes. No further details of the agreement were disclosed.

ProLease is a polymeric microsphere that works in a way similar to dissolving sutures. A related Alkermes technology is Medisorb, which is applied to small molecules.

"The Medisorb technology is like an oil-water emulsion," such as vinegar-and-oil salad dressing when shaken, and is suitable for delivering small molecules, Landine said.

Proteins, on the other hand, "generally don't like water," he said. The ProLease formulations are done in liquid nitrogen, at extremely cold temperatures to preserve their activity. "The protein never sees water," Landine said.

Alkermes has two other collaborations with Johnson & Johnson, both begun in 1996. The first of those deals combined ProLease with an undisclosed compound to treat hormone-mediated disorders. The second paired Medisorb with another unidentified drug. Each deal was worth more than $20 million. (See BioWorld Today, Dec. 3, 1996, p. 1.)

Johnson & Johnson licensed EPO from Amgen Inc., of Thousand Oaks, Calif., which sells its own brand of EPO, called Epogen, for use with dialysis patients. Ortho Pharmaceuticals Corp., a division of Johnson & Johnson, sells EPO under the name Procrit for non-dialysis use. Procrit has been found effective in HIV patients treated with AZT.

Deal Covers Non-Dialysis Indications

Amgen and Ortho became involved in a court skirmish over dividing revenues from spillover sales to customers using both brands of EPO, and the case was resolved last fall, with a judge ruling that Amgen owes $96 million to Ortho — which had estimated the amount due at $423 million. (See BioWorld Today, Sept. 16, 1997, p. 1.)

The sustained-release EPO under development in the Alkermes-Johnson & Johnson deal would be used in non-dialysis indications.

Another ProLease agreement, with Genentech Inc., of South San Francisco, covers delivery of human growth hormone. The pact began in 1995, and Genentech expanded it the following year, pledging up to $30 million. (See BioWorld Today, Nov. 15, 1997, p. 1.)

"We started Phase III trials in December," Landine said.

Alkermes' third technology is receptor-mediated permeabilizer 7, which carries compounds through the challenging blood-brain barrier. In a deal with Palo Alto, Calif.-based Alza Corp., Alkermes is targeting metastatic brain cancer. (See BioWorld Today, Oct. 7, 1997, p. 1.)

"By the end of this quarter, we'll be in a Phase III trial," Landine said.

Alkermes' stock (NASDAQ:ALKS) closed Thursday at $23.125, up $1.875. *

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