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EntreMed pact altered
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February 9, 1999: 8:13 p.m. ET
Bristol-Myers cedes responsibility for cancer drug to EntreMed
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NEW YORK (CNNfn) - Drug company Bristol Myers Squibb Co. said Tuesday it is turning over responsibility for developing a highly-touted cancer drug to EntreMed Inc. so it can devote more resources to its own research and development projects.
In a statement, Bristol said EntreMed will assume responsibility for all future preclinical and clinical work on the Angiostatin molecule, which had been touted by study collaborator EntreMed as able to reduce tumor cells in mice.
EntreMed (ENMD) officials stressed the move does not mean Bristol Myers is withdrawing support for the drug, which is expected to begin human clinical trials this fall.
"We had a parallel effort underway in our lab and theirs," John Holaday, EntreMed chairman and chief executive told CNNfn in a telephone interview.
He said Bristol-Myers apparently decided its method of drug development was not progressing as rapidly as EntreMed's. "They are still riding shotgun with us. We're still in the same car. This allows us to maintain a collaboration with them using our system."
He added Bristol-Myers will continue to make milestone payments and would have to pay higher royalties if the drug is ultimately approved by the Food and Drug Administration because EntreMed is bearing the brunt of the development costs.
Since the partnership began in 1995, EntreMed has received some $30 million in milestone payments from Bristol-Myers.
EntreMed shares surged in May
Shares of the drug developer EntreMed surged in May 1998 after reports surfaced that a Harvard researcher, Dr. Judah Folkman, had reduced tumor cell levels in mice using drugs angiostatin and endostatin.
Folkman had been developing the drugs for EntreMed, which licensed the agents.
The decision by Bristol-Myers effectively forces EntreMed to go it alone in proving the drug is effective.
"At this time, Angiostatin protein in its present form does not meet our criteria for molecules that advance to clinical trials," said Robert Kramer, vice president of Oncology Drug Discovery at Bristol-Myers Squibb, a top developer of cancer-related drugs.
Robert Kramer, vice president for oncology drug discovery at Bristol-Myers said the company typically evaluates its spending plans every year, and after looking at the investment that would be required to bring the drug to market, Bristol-Myers decided to stop developing the drug in its labs and allow EntreMed to take the lead.
In an interview with CNNfn, he described the internal research and development effort associated with the drug as "enormous" and said the molecule is likely to be the most expensive molecule ever to go into a cancer patient.
Nevertheless, he said the company remains upbeat about the drug's potential.
Bristol-Myers Squibb (BMY) said it would retain an option to resume development and marketing rights of angiostatin should clinical proof of its effectiveness appear.
Bristol shares closed Tuesday at 122-1.2, down 3-1/16 while EntreMed closed at 24-1/2, down 13/16.
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