Centocor Inc. said Thursday that CenTNF, its tumor necrosisfactor antibody to treat gram-negative and gram-positivesepsis, could suffer delays if the company decides to put moneyinto more clinical trials of Centoxin, its first anti-sepsis drug.

"If a decision on Centoxin affects any of the products indevelopment, it would affect CenTNF because it draws on thesame resources," said Richard Koenig, a spokesman for theMalvern, Pa., company.

The stock (NASDAQ:CNTO) fell a further $2.50 to $16 onThursday. It lost $12.75 on Wednesday after Centocorannounced that the FDA won't approve Centoxin on the basis ofdata submitted by the company.

The agency told Centocor that it should conduct a new, "well-controlled" trial before Centoxin can be given furtherconsideration for marketing approval.

"Our discussions with the agency will center on what's a 'well-controlled trial' and how to carry that off," Koenig said.

The FDA action increased interest among Wall Street analystsabout an extensive review of Centoxin, expected to appear nextweek in the New England Journal of Medicine, which is said tocall for an additional trial of the drug.

A return to the clinic would likely put Centoxin back at theagency in the same time frame as Synergen Inc.'s Antril IL-1ra,which appears to work in both gram-positive and gram-negative sepsis. The Boulder, Colo., company (NASDAQ:SYGN)plans to file in 1993. CenTNF, by comparison, is already behindschedule, and its marketing application is likely to be delayedinto 1993.

Koenig said there will be a role for anti-endotoxin drugs totreat sepsis even as Antril, CenTNF and other drugs indevelopment reach the market.

Until a decision on Centoxin is made, Koenig said, the companywon't take any action to reduce its $50 million-per-quarterburn rate or reduce its 200-person U.S. sales force. In 1991,Centocor had $8.3 million in European sales of the drug.

The Centoxin debacle had some Wall Street analysts speculatingthat the company is ripe for acquisition, much as Cetus Corp.was set up for a sale after the FDA turned down Proleukininterleukin-2 on its first go-round in 1990. "We now believeCentocor is set up for either a major corporate restructuring orthe sale of the company," wrote Vector Securities InternationalInc. analyst Peter Drake.

"Management has lost credibility, and as a result it will eitherhave to fix the situation with the FDA quickly or have thecompany sold out from under it," wrote Jeffrey Casdin ofOppenheimer & Co. "At its current valuation of about $900million, including debt, we think the company is attractive to alarge drug or biotech company interested in getting a hold ofCentocor's considerable biotechnology assets."

The next big products on Centocor's horizon aren't due to cometo market until 1994. The company has announced plans to filethree product license applications within the next two years.The timetable remains unchanged for its next product, CentoRx,an anti-thrombotic monoclonal antibody. The drug is in PhaseIII trials for abrupt arterial closure following coronaryangioplasty, and Centocor plans to file a PLA by year-end.

In February, Koenig told BioWorld that CenTNF would enterPhase III trials in the first quarter, with a PLA by the end ofthe year. That schedule has now slipped, with Phase III trialsin Europe slated to begin some time this year.

The company's third big product, Centara to treat autoimmunediseases, is in Phase II trials for rheumatoid arthritis, and thecompany hopes to file a PLA in 1993 for an undeterminedindication.


The AMEX Biotechnology Index fell another 4.32 points onThursday as the sector sell-off widened in the wake of CentocorInc.'s Centoxin problems. The index closed at 143.96.

-- Karen Bernstein BioWorld Staff

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