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UPDATE 2-Genmab updates strategy, teams with Seattle Genetics
September 14, 2010 / 7:46 AM / 7 years ago

UPDATE 2-Genmab updates strategy, teams with Seattle Genetics

* New strategy focuses on most advanced drugs

* Also focuses on forming new strategic partnerships

* Aims to reduce operating costs by 20 percent in 2011

* Teams up with Seattle Genetics for drug research

* Seattle Genetics gets upfront sum, co-development option

(Adds detail, quotes, shares)

By John Acher

COPENHAGEN, Sept 14 (Reuters) - Danish biotech company Genmab A/S (GEN.CO) will collaborate in cancer drug research with Seattle Genetics (SGEN.O) under a strategy to focus on strategic partnerships for drug development.

Key elements of the updated strategy, which follows the appointment of Jan van de Winkel as chief executive in June, also included a goal of managing cash burn to reduce operating costs by 20 percent in 2011, Genmab said on Tuesday. [ID:nWEA7938]

Genmab said the recent renegotiation of its cooperation deal with GlaxoSmithKline (GSK.L), with which it is co-developing cancer drug Arzerra, had boosted its financial security and funding needs for years to come.

Strategic priorities include maximizing value from Genmab’s most advanced products ofatumumab and zalutumumab, as well as forming new strategic partnerships to extract value from preclinical pipeline developments and research capabilities.

Genmab said it had agreed to collaborate with Seattle Genetics in research related to the development of cancer drugs, using the American partner’s antibody-drug conjugate (ADC) technology. [ID:nWEA7894]

Genmab said the deal with Seattle was an example of the kind of partnerships it aimed to establish at various stages of product development.

UPFRONT PAYMENT

Under the deal, Genmab gets access to Seattle Genetics’ ADC technology while the U.S. firm gets an undisclosed upfront payment and an option to co-develop resulting ADC products at the end of Phase I clinical development, Genmab said.

ADCs are monoclonal antibodies that selectively deliver potent anti-cancer agents to tumour cells, Genmab said.

“ADC technology represents the next promising wave of cancer therapeutics, combining the best characteristics of antibodies and chemotherapy into one,” said van de Winkel.

The Dutchman, Genmab’s former chief scientific officer, replaced Lisa Drakeman as CEO in June following criticism of mis-steps at the company whose shares had plummeted 80 percent in value over the previous three years. [ID:nLDE65E0PV]

Seattle Genetics has developed proprietary technology employing synthetic, cell-killing agents called auristatins and linker systems that attach auristatin to the antibody, it said.

Genmab will be responsible for research, manufacturing, preclinical development and Phase I clinical trials of ADCs under the deal, while Seattle Genetics will get payments for any assistance provided to Genmab, the Danish firm said.

If Seattle Genetics opts into an ADC product at the end of a Phase I trial, the firms would co-develop and share future costs and profits from the product on a 50/50 basis, Genmab said.

If Seattle Genetics does not opt in to an ADC product, Genmab would pay Seattle Genetics fees, milestones and mid-single digit royalties on worldwide net sales of the product, Genmab said.

Shares in Genmab slipped 1 percent to 64.55 by 1035 GMT, against a 0.4 percent rise in the MSCI European pharma, biotech and life sciences index .MIEU0PB00PEU. (Editing by David Cowell and David Holmes)

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