Genentech puts muscle behind blood drug
programme by licensing just one compound for up $800m (€615m),
highlighting the willingness of large pharmaceutical companies to
pay large sums for even a single drug candidate.
In the past six months alone, Genentech has publicly committed to spending up to $2.9bn (€2.2bn) in licensing and acquisition deals to bolster its pipeline. Under the terms of the latest deal, Genentech will have exclusive worldwide rights to the development and commercialisation of Seattle Genetics' SGN-40, which is currently in Phase I and Phase II trials.
The antibody was developed for treatment of multiple myeloma, chronic lymphocytic leukaemia and non-Hodgkin's lymphoma, diseases that are estimated to kill 30,000 US residents every year.
"We are very interested in the encouraging activity of SGN-40 observed in early clinical trials and we look forward to developing this antibody with Seattle Genetics, in addition to our ongoing collaboration on antibody-drug conjugates," said Hal Barron who is the development and chief medical officer for Genentech.
The drug targets the CD40 antigen, which is found on the surface of tumour cells and contributes to cell growth, differentiation and survival. Seattle Genetics is currently conducting separate Phase I and Phase II clinical trials of SGN-40.
Genentech will pay $60m up front and fund the future research, development, manufacturing and commercialisation costs of SGN-40, including reimbursing Seattle Genetics for the cost of the current clinical trials.
"This alliance enables us to accelerate and expand development of SGN-40 while we continue to advance our other promising clinical and preclinical development programmes," said Dr Clay Siegall, CEO of Seattle Genetics.
In a separate deal, Genentech has also purchased an entire drug discovery programme from California-based Amphora Discovery. The deal includes all of the intellectual property for the unnamed oncology programme, including the preclinical lead and several backup series. Financial details of the deal were not released.
In July 2006, Genentech set up a collaboration deal with Inotek Pharmaceuticals that could cost up to $405m to develop poly (ADP-ribose) polymerase (PARP) inhibitors for the potential treatment of cancer.
This was followed in October by a potential $500m deal with CGI Pharmaceuticals to develop an undisclosed target for the potential treatment of multiple cancers and autoimmune diseases.
Then, in November, Genentech bought Tanox for $919m. Although they gained Tanox's pipeline, the main driver for the deal was an asthma drug approved in 2003. Genentech and Tanox had been working in collaboration with Novartis for 10 years to develop and commercialise Xolair (omalizumab), an anti-IgE monoclonal antibody.
In the first nine months of 2006, US sales of Xolair hit $307m and peak sales are estimated at $1.1bn. The acquisition, which is expected to be completed in the first quarter of this year, looks to be solid business since it enabled Genentech to avoid paying royalties to the other two companies.
Only a month later, Genentech agreed to pay AC Immune up to $300m to licence their Alzheimer's antibodies.
The trend of large pharma to look towards smaller companies to provide drug candidates has been further underscored by GlaxoSmithKline (GSK). First, in December 2006, the pharma giant agreed a potential $1.2bn collaboration with EPIX pharmaceuticals over their G-protein coupled receptor (GPCR) drug development programme and then later in the same month signed the world's biggest licencing deal ($2.1bn) with Genmab for a leukaemia drug.
