By Charles Craig
Techniclone International Corp., which is developing monoclonal antibodies to fight cancer, proposed acquiring privately held Peregrine Pharmaceuticals Inc. and its anti-cancer antibody technology in a stock swap valued at $24.8 million.
Techniclone, of Tustin, Calif., offered to issue four shares of its stock for each outstanding Peregrine share. Officials said stockholders representing a majority interest in Peregrine have agreed to the swap.
If all Peregrine stockholders accepted the offer, Techniclone officials said they would issue about 4.725 million shares for the 1.125 million Peregrine shares outstanding. Based on the $5.25 closing price of Techniclone's stock (NASDAQ:TCLN) Thursday, the day the takeover proposal was reported, the acquisition would be worth $24.8 million to Peregrine shareholders.
Techniclone ended Friday up $0.125 to $5.375.
Techniclone's interest in Peregrine, of Princeton, N.J., focuses on its Vascular Targeting Agents (VTA), which are monoclonal antibodies that deliver a thrombotic agent to clog blood vessels of cancer tumors, killing the cells.
The VTAs are designed to initiate thrombosis only when they come into contact with endothelial cells at the site of the tumor.
The VTA monoclonal antibody targets vascular endothelial growth factor, which is secreted by tumor cells to signal endothelial cells to begin forming blood vessels needed to feed growing tumors. The clotting agent, delivered by the antibody, is a shortened form of tissue factor, which is a triggering molecule in the natural coagulation process.
Peregrine's VTA technology was developed at the University of Texas Southwest Medical Center in Dallas. The anti-cancer research is in preclinical development. Clinical trials may begin in about 18 months.
The VTA antibody is designed as a monotherapy, but Techniclone said it will fit well in combination with its Tumor Necrosis Therapy (TNT), which also is considered a first-line treatment. Both technologies are potential drugs for most, if not all, solid tumors.
TNT uses monoclonal antibodies to deliver cancer-killing agents inside tumor cells rather than to the surface membrane, which is the target for most other anti-cancer antibodies.
The TNT antibody zeroes in on a DNA-associated antigen found inside all cells, but the monoclonal can penetrate only those cells whose membranes are disintegrating. Because the surfaces of cancer cells are weaker than those of healthy cells, the TNT antibody is tumor-specific.
In using TNT and VTA together, Techniclone officials noted the latter, by blocking cancer cells' blood supply, generates massive tumor necrosis and improves the effectiveness of TNT, whose antibody can deliver a variety of cancer-killing agents, such as radioactive isotopes.
Clinical trials of a TNT antibody are expected to begin this year.
Techniclone's most advanced product, LYM-1, is a monoclonal antibody combined with radioactive iodine for treatment of non-Hodgkin's B cell lymphoma. The drug, developed in collaboration with Alpha Therapeutic Corp., of Los Angeles, is being evaluated in Phase II/III trials. Alpha Therapeutic is the U.S. subsidiary of The Green Cross Corp., of Osaka, Japan. *