After four months of searching for a corporate partner topick up Bradycor, a drug that failed in clinical studies forsepsis, Cortech Inc. found a buyer in London-basedSmithKline Beecham plc, which will pay up to $25million for rights to continue development of thebradykinin antagonist in other indications.

Financial terms were not disclosed, but Cortech, ofDenver, will receive an up-front licensing fee andmilestone payments. SmithKline Beecham, whose U.S.headquarters are in Philadelphia, also will assume alldevelopment costs.

The pharmaceutical firm initially will continue clinicalstudies of Bradycor as a treatment for traumatic braininjury and pursue preclinical research for ischemic stroke.

Joseph Turner, Cortech's chief financial officer, said hiscompany could receive up to $19 million if SmithKlinegains approval of Bradycor for traumatic brain injury andanother $9 million if the drug makes it to market forischemic stroke. Turner also said Cortech would receiveroyalties that escalate based on Bradycor's sales volume.

Turner said SmithKline has purchased rights to allpharmaceutical applications of Bradycor. The drug isdesigned to block receptors to bradykinin, which has beenshown to produce pain and initiate inflammatoryresponses and edema.

Cortech's development of the drug took a turn for theworst in July 1994 when Bradycor failed to demonstrateeffectiveness in treating sepsis, a disorder that hasfrustrated a parade of biotechnology companies.

In July 1995, a second Phase II trial targeting a subgroupof sepsis patients with gram-negative infections alsoproved a failure. In that study, mortality was higheramong the Bradycor treatment group than the placebogroup and Cortech discontinued all development of thedrug, which included halting a second Phase II trial fortraumatic brain injury. A subsequent analysis of the sepsisstudy showed the deaths were not related to Bradycor.

Cortech, however, restructured the company in August1995 and began seeking a partner to continuedevelopment of Bradycor.

A pilot Phase II trial of the drug for brain trauma injury,completed in November 1994, showed Bradycor achievedstatistical significance in reducing brain swelling causedby external head injuries.

Cortech's stock (NASDAQ:CRTQ) closed Thursday at$1.87, up 12 cents. SmithKline (NYSE:SBE) lost 75cents, ending the day at $50.62. n

-- Charles Craig

(c) 1997 American Health Consultants. All rights reserved.