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Volume 85 Issue 1 | p. 11 | News of The Week
Issue Date: January 1, 2007

Biopharmaceuticals

GSK pays big for late-stage cancer drug
Department: Business

GlaxoSmithKline's year-end shopping spree continued with a licensing deal worth up to $2.1 billion for Genmab's late-stage cancer drug. The pact includes a $102 million up-front fee and a $357 million stake in the Danish firm.

GSK gains the rights to HuMax-CD20, a fully human monoclonal antibody currently in Phase III trials for treatment of both non-Hodgkin's lymphoma and a type of leukemia. It is in Phase II studies to treat patients with rheumatoid arthritis.

The lofty price tag highlights the lengths to which some big drug companies will go to refill their pipelines and stay on the cutting edge of technology.

ABN-AMRO analyst Mattias Häggblom points out that the up-front and potential milestone payments put the GSK/Genmab deal just behind Bristol-Myers Squibb's pact with ImClone Systems for the cancer antibody Erbitux, the biggest licensing deal to date in the biotech arena. With GSK backing the drug, analysts expect HuMax-CD20 to generate annual sales of $2 billion to $3 billion at its peak.

In addition to HuMax-CD20, GSK captures an exclusive option to CD20 UniBody, a drug based on Genmab's next-generation technology that targets disease with fragments of IgG4 antibodies.

For the British firm, the Genmab deal is the biggest in a December buying spree that bolsters its small- and large-molecule drug operations. Just days after the Genmab announcement, GSK said it would pay $54.8 million for the small-molecule drug company Praecis Pharmaceuticals. Earlier in the month, GSK laid out $454 million for Domantis, a biopharmaceutical company with next-generation antibody technology, and entered a small-molecule drug development agreement with Epix Pharmaceuticals worth up to $1.2 billion.

 
Chemical & Engineering News
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