Greenwich Pharmaceuticals Inc. stock dropped almost 32percent following an announcement on Friday that SyntexPharmaceuticals International Ltd., a subsidiary of SyntexCorp., terminated a 1989 development and license agreementbetween the two companies for Greenwich's lead drug,Therafectin.
Greenwich's stock (NASDAQ:GRPI) closed down $2.50 per shareto $5.25 on Friday. Stock in Syntex Corp. (NYSE:SYN) was off 38cents a share to $25.88.
Greenwich's Therafectin, an amiprilose hydrochloridecompound, is currently in late Phase III trials for rheumatoidarthritis.
Greenwich spokeswoman Pamela Murray declined to discussreasons for the termination of the pact, but said the company isstill on schedule with its plans to file a new drug approval(NDA) application for Therafectin with the FDA. Murray wouldnot disclose an estimated time frame for that filing.
One thing that is clear is that Greenwich of Fort Washingon, Pa.,is running low on cash and, according to its 1992 10K report,has only enough to last until the first quarter of 1993.
The alliance between the Greenwich and Syntex of Palo Alto,Calif., apparently had fallen on hard times.
"The relationship has experienced friction in the past," saidJohn McCamant of the Berkeley, Calif.-based Medical StockTechnology Newsletter. He said that Syntex was behind ingetting plant approval for manufacturing the product andGreenwich wasn't prepared to help out with manufacturing.McCamant said Greenwich needs money and will probably haveto consider signing another marketing partner.
Another industry expert, who spoke on condition of anonymity,said Syntex has doubts that Therafectin actually works."Therafectin has always been a product in search of a cure; it'sbeen tried on a number of applications, including cancer, andthey (Greenwich) can't seem to run trials that show clearefficacy for any application."
Syntex spokeswoman Linda Thomas declined to commentspecifically on why Syntex terminated the relationship, butsaid, "The agreement no longer fits into our plans."
Under the terms of the original agreement, Syntex received co-exclusive marketing rights for the drug in Canada, Mexico, theBahamas, Australia and New Zealand in exchange for fundingrelated research.
Syntex originally may have been interested in Therafectinbecause the patent on its own drug for the symptomatic reliefof rheumatoid arthritis, Naprosyn, had expired in manycountries and will expire in the U.S. in December 1993.
"The termination is news to us," said Murray, "and so wehaven't made any contingency plans. We may need to considerwhether we want another alliance."
-- Michelle Slade Associate Editor
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