MedImmune Inc. Wednesday renegotiated the collaboration on itsfirst marketed product, CytoGam, with Connaught Laboratories Inc.and registered for a public offering of 2 million shares, which isexpected to raise about $40 million.
In the new agreement with Swiftwater, Pa.-based Connaught,MedImmune, of Gaithersburg, Md., will reduce the royalty rate paidto Connaught on sales of CytoGam, a polyclonal antibody forprevention of cytomegalovirus in kidney transplant patients.
MedImmune reacquired all marketing rights to the drug fromConnaught in 1992, two years after CytoGam was approved by theFDA. MedImmune now sells the product and in 1994 it generated$12.1 million in revenues. Through the first nine months of 1995,CytoGam sales were $11.1 million, a 28 percent increase over theprevious year.
Mark Kaufmann, MedImmune's manager of strategic planning andinvestor relations, said the royalty rate was not disclosed. The revisedcollaboration also includes a two-year agreement with Connaught tofill and package for shipment CytoGam and RespiGam, anotherpolyclonal antibody under review by the FDA. Last month an FDAadvisory panel recommended approval of RespiGam for respiratorysyncytial virus.
The amended agreement with Connaught will cost MedImmune $2.7million.
Both CytoGam and RespiGam are manufactured by theMassachusetts Public Health Biologic Laboratories in Boston, whichlicensed the drugs to MedImmune.
MedImmune has collaborations with American Home ProductsCorp., of Madison, N.J., for co-promoting RespiGam in the U.S. andwith Baxter Healthcare Corp., of Deerfield, Ill., forcommercialization elsewhere.
MedImmune, which has six other products in clinical development, ishoping to use the $40 million from its public offering to supportmarketing activities and build its own manufacturing facility.
Morgan Stanley & Co., of New York, and Vector SecuritiesInternational Inc., of Deerfield, are managing the 2 million sharestock sale. Based on MedImmune's $19 closing price(NASDAQ:MEDI) Wednesday, which was unchanged from the daybefore, the offering would raise $38 million.
As of Sept. 30, 1995, MedImmune said it had $27.5 million in cashand a net loss for the first nine months of $14.1 million. Followingthe offering, the company will have 19.6 million shares outstanding.n
-- Charles Craig
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