Hospira signs deal to market cancer treatment overseas
ChemGenex Pharmaceuticals Ltd., the Australian drugmaker seeking regulatory approval for its experimental cancer treatment, said it signed a partnership agreement with Hospira Inc. to develop and sell the medicine in Europe, the Middle East and parts of Africa.
Hospira, based in Lake Forest, will initially pay 11.1 million euros ($16 million) and then as much as 74.1 million euros in performance payments linked to the development and commercialization of the medicine, Omapro, ChemGenex said today. Hospira will also pay Geelong, Australia-based ChemGenex a royalty on sales in those markets for the drug used to treat chronic myeloid leukemia.
Shares of ChemGenex, which has yet to post a profit, jumped as much as 10 percent. Omapro, also called omacetaxine mepesuccinate, is targeted at patients with a genetic mutation that makes them resistant to Novartis AG's Gleevec. The market for patients who fail two or more drugs in Gleevec's category may reach $1.4 billion by 2020, according to Shane Storey, a health-care analyst with Wilson HTM Investment Group in Brisbane.
The agreement is "in keeping with our corporate strategy of partnering in Europe and other parts of the world, as we prepare for the launch of omacetaxine in the U.S., if approved," ChemGenex Chief Executive Officer Greg Collier said in a statement.
ChemGenex said on Sept. 9 it completed a submission to the U.S. Food and Drug Administration and expects the regulator to approve Omapro by mid-2010.
Chronic myeloid leukemia is a slow-progressing disease caused by a genetic flaw that triggers the overproduction of white blood cells.
Trials have shown the drug cuts white blood cells to normal levels in patients with the T315I mutation for which Gleevec, the drug that earned Novartis $3.7 billion in sales last year, is the standard treatment. The same mutation also makes patients unresponsive to alternative drugs including Novartis's Tasigna and Bristol-Myers Squibb Co.'s Sprycel.
ChemGenex rose 2.7 percent to 95.5 Australian cents as of 12:21 p.m. in Sydney trading, while the S&P/ASX 200 Index slipped 0.3 percent. The stock has doubled this year, surpassing the 24 percent gain for the benchmark index. Hospira fell 1.1 percent to $47.51 in New York trading on Dec. 11 and has advanced 77 percent this year.