Worried investors sent ImmuLogic Pharmaceutical Corp.'s stockdown 22 percent Monday after Hoechst Marion Roussel ended itscollaboration on the former's Allervax allergy drugs, two of whichare in late-stage clinical trials.
ImmuLogic, of Waltham, Mass., tried to ease investor concerns,saying loss of the corporate partner will not alter the timetable forfiling marketing applications for Allervax products to treat cat andragweed allergies.
ImmuLogic expects to file for FDA approvals of Allervax Cat, whichis in Phase III trials in North America, by the end of this year andAllervax Ragweed in early 1997.
A recently completed placebo-controlled Phase II/III trial of AllervaxRagweed involving 960 patients showed the drug achieved statisticalsignificance in improving allergy symptoms. The results, releasedFeb. 29, 1996, boosted ImmuLogic's stock (NASDAQ:IMUL) 11percent to $19.75. (See BioWorld Today, March 4, 1996, p. 2.)
Hoechst's decision to end the Allervax collaboration, which wasforged with Kansas City, Mo.-based Marion Merrell Dow Inc. in1992 prior to its takeover last year by the German drug maker,shoved ImmuLogic back $3.75 in heavy trading of 2.2 million shares.The stock ended Monday at $13.25.
Michael Slater, ImmuLogic's executive vice president, said not onlyis the Allervax program still on track, but the company's Walthammanufacturing facility has the capacity to meet supply demands forcommercial launches and the first couple years of sales for AllervaxCAT and Allervax Ragweed.
Slater said throughout the collaboration with Marion Merrell Dow,ImmuLogic was responsible for U.S. development. Marion Merrellcontributed $24 million in license fees and milestone payments andpaid for overseas clinical trials. The two companies had a 50-50agreement for development and commercialization.
With the departure of Hoechst, ImmuLogic regains all rights to theAllervax Cat, Allervax Ragweed and three other Allervax drugs.
In March 1995, less than a month after Hoechst AG, of Frankfurt,Germany, proposed a $7.2 billion takeover of Marion Merrell, theKansas City pharmaceutical company expanded its agreement withImmuLogic to include construction of an Ohio manufacturing facilityfor the Allervax products. Hoechst acquired Marion Merrell in May1995 and never proceeded with the Allervax plant.
Hoechst's pharmaceutical division, Hoechst Marion Roussel, isheadquartered in Frankfurt and is a collaboration with Paris-basedRoussel Uclaf S.A.
In ending the Allervax agreement, Hoechst, which owns 6 percent ofImmuLogic's 20 million outstanding shares, was required to file astatement with the Securities and Exchange Commission saying itwas changing its relationship with the biotechnology company andintended to sell ImmuLogic shares.
However, Richard Small, ImmuLogic's chief financial officer, saidHoechst's SEC document does not state the company is selling thestock immediately.
ImmuLogic officials said they will look either for other globalpartners or for regional collaborations, such as alliances focused onJapan, Europe or the U.S., and could have a deal negotiated in six to12 months.
Slater said the company already had been discussing potentialcollaborations for Allervax products outside the Hoechst agreement.
Tim Wilson, analyst for UBS Securities Inc. in New York, saidHoechst's decision is not based on any inside information it has aboutdata from Allervax trials.
Since taking over Marion Merrell, Hoechst has been re-evaluating itsbusiness strategy. Wilson suggested ending the ImmuLogic allianceis consistent with the German drug maker's move away frombiologicals, such as the Allervax peptide immunotherapeutics andvaccines.
Last month Hoechst sold Chiron Corp., of Emeryville, Calif., about50 percent of its vaccine division and gave it an option to buy therest. Hoechst subsidiary, Behringwerke AG, of Marburg, Germany,operates the vaccine business. (See BioWorld Today, Feb. 21, p. 1.)
Wilson said ImmuLogic apparently was frustrated with Hoechst'slack of commitment. He added the challenge for ImmuLogic will beto get another partner soon with strong manufacturing and marketingcapabilities to ensure growth in sales of Allervax Cat and AllervaxRagweed. n
-- Charles Craig
(c) 1997 American Health Consultants. All rights reserved.