Posted by TAP NEW YORK, Feb 17 (Reuters) - Biotech firm Genta Inc. (NasdaqNM:GNTA - news), which has developed a promising new skin and blood cancer treatment, is hoping to seal a partnership deal with a global pharmaceuticals company that could help give its drug a flying start. Berkeley Heights, New Jersey-based Genta told Reuters late last week that it was ``very, very far along'' in discussions with a partner, and plans to announce terms of the transaction shortly. The drug, Genasense, could be as valuable, or more so, than ImClone Systems Inc.'s (NasdaqNM:IMCL - news) experimental and much-touted Erbitux, analysts said. In September, drug industry giant Bristol-Myers Squibb Co (NYSE:BMY - news). agreed to pay as much as $2 billion for a 20 percent stake in ImClone. ``There's less risk associated with Genta's clinical development strategy than with ImClone's,'' said Patrick Mooney, an analyst at Thomas Weisel Partners, which has no banking relationship with Genta. ``I think Genta has the best small-cap management team in the business today.'' Genasense is initially being developed for malignant melanoma, a deadly skin cancer; multiple myeloma, a blood cancer and chronic lymphocytic leukemia, also a form of blood cancer. Speculation about the prospective partner's identity swirls around Roche Holding Ltd. . In December, Genta appointed Patrick Zenner, former president and chief executive of Hoffman-La Roche Inc., Roche's U.S. arm, to its board. Roche is one of the world's leading cancer drug companies, whose treatments include Rituxan, the first monoclonal antibody for non-Hodgkin's lymphoma and Herceptin and Xeloda for breast cancer. Another company that says it is talking to Genta is Aventis SA , the Franco-German pharmaceuticals company. ImClone's battle with Bristol-Myers for control over Erbitux, it said, is having no effect on its talks. ``There is no impact from this issue on these negotiations,'' said Lori Kraut, an Aventis spokeswoman. Unlike ImClone, Genta is unlikely to part with equity in the company, analysts said. And Chief Executive Raymond Warrell said he hopes to retain U.S. rights, or part of them, to Genasense, which is in late-stage clinical trials. In any partnership, Genta would likely get an upfront payment of at least $250 million and substantial royalties once the drug hits the market, analysts said. ``If Genta co-markets the North American rights you'll be looking at a significantly larger amount,'' said Darren Mac, an an analyst at Gruntal & Co. Genasense is one of a new class of drugs based on technology known as antisense. The drug blocks the expression of a protein in genes that help make cells resistant to chemotherapy and other cancer-fighting treatments. ``It's a potential blockbuster in every sense of the word,'' said Raymond Warrell, Genta's chief executive officer and former associate physician-in-chief at Memorial Sloan-Kettering Cancer Center. Genta plans to release the results of its phase III trial by the middle of this year. It plans to announce the name of its partner before that. Warrell said Genta is ``very pleased with the pace'' of discussions with its lead candidate. Drugs in late-stage development are hotly sought after by big pharmaceuticals companies eager to acquire new products for their depleted pipelines.
on 2/21/2002, 7:59 am
Genta says close to deal for skin, blood cancer drug
By Toni Clarke
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