Bio-Technology General Corp. said Friday that itsrecombinanthuman growth hormone (hGH) was left at the starting gate byits European marketing partner.

BTGC (NASDAQ:BTGC) of New York said that it told bySmithKline Beecham plc (SKB) representatives during a meetinglast week that the larger company wanted out of a 1988exclusive marketing agreement to sell BTGC's BioTropin hGHproduct in Europe.

"The decision by SKB several days ago came as a surprise tous," Sim Fass, BTGC's president and chief executive officer, toldBioWorld on Friday. He conceded that the relationship betweenthe two companies had unravelled in recent months.

SKB spokesman Jeremy Heymsfeld declined specific commentFriday afternoon on his company's decision regardingBioTropin. "We continuously evaluate and re-evaluate thestrategic compounds we are working with, and in this case, wemade our decision based on our normal strategic planning."

BTGC said it reacquired the European marketing rights byagreeing to repay SKB $3 million over the next three to fiveyears for the larger company's marketing costs. BTGC is nowtalking with new potential partners and hopes to lose no morethan two or three months from its planned September launchwith SKB, Fass said.

"In the ultimate scheme of things we won't see a great delay,and within the next 30 days we will have a European partnersuch that we will get the launches off the ground by Novemberor December," said Fass.

BioTropin, which has received marketing approval in six of the12 EC nations, would enter the briskly competitive $275 millionEuropean hGH market, where five other products are alreadybeing sold by Kabi (with Genentech Inc.'s Protropin), Eli Lilly &Co. (HumaTrope), Serono, Novo and Sonofi.

"It's a crowded field, so having a partner that understandspeptides, hormones and the endocrinology physician target iscritically important in terms of the success of any deal we do,"Fass said.

SKB wanted to exercise its rights under the agreement tosublicense BioTropin in six large European countries, Fass said.BTGC was willing to sublicense, provided that it received the 30percent royalty on BioTropin sales that was part of theexclusive licensing agreement with SKB. "We were not preparedto reduce what was originally committed to us, or acquiesce toa sublicensee," he said.

SKB was also disappointed with the timing of a product launchset for September or October, and because BTGC had not yetreceived approval for an extended product expiration to 24months from its current 12 months, Fass said.

Fass said that BTGC's BioTropin is being held back from filingfor U.S. marketing marketing by an orphan drug designation,due to expire in early 1994, on Lilly's HumaTrope. He's hopingthat proposed modifications to the Orphan Drug Act mightspeed up BTGC's entry into the U.S. market, where Genentech'sProtropin has the largest market share, with about $165million in sales.

BTGC has 12 products in various stages of development, with abovine growth hormone awaiting final regulatory review.

BTGC shares closed Friday at $6.75, down 13 cents. n

-- Michelle Slade Associate Editor

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