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Taking stock
11-14-2007
SHARING OPTIONS:
SEATTLE—In a
classic case of how people make the difference, Cell Therapeutics Inc. has
entered into an agreement to acquire Systems Medicine Inc., a privately held
oncology company, in a stock for stock merger valued at $20 million. SMi
stockholders could also receive a maximum of $15 million in additional
consideration, payable in either cash or shares of CTI common stock, upon the
achievement of certain regulatory milestones.
According to Tim Williamson, CBO and a founder of SMi, the
deal was struck after he began conversations with CTI Chief Medical Officer Dr.
Jack Singer about a possible collaboration to work on improving the solubility
of another anti-cancer drug—an SRC inhibitor. As talks progressed, it became
clear, he says, that the companies had more strategic compatibilities,
eventually leading to the merger. Under the terms of the agreement, SMi will
operate as a wholly owned subsidiary of CTI, utilizing its genomic-based
platform to guide development of CTI's oncology products, which include
Brostallicin.
Brostallicin is a synthetic, second-generation DNA minor
groove binder with potent anti-cancer activity in experimental tumor models,
the newly merged partners say. The mechanism of DNA interaction is novel,
binding covalently to DNA within the minor groove. Prior to this discovery,
most cancer drugs have targeted the major groove in DNA leading to the
successful introduction of several new classes of anti-cancer drugs, including
topoisomerase inhibitors such as camptothecins and anthracyclines.
But as SMi co-founder Dr. Daniel Von Hoff points out, this
novel mechanism of action has not been without its own unique problem, such as
bone marrow suppression that prevented the drug from being given for long
cycles. Von Hoff, who is currently a division director at the Translational
Genomics Research Institute (TGen), and is expected to head CTI's strategic
product portfolio committee, stresses the important advance Brostallicin
represents by having this limiting problem "bred out of it." To date, the drug
has demonstrated proven anti-tumor activity in soft cell sarcoma and will
likely be tested against non-small cell lung cancer and ovarian and
head-and-neck tumors, Von Hoff adds. The drug has shown a favorable safety
profile in more than 200 patients treated to date in clinical trials.
Brostallicin is currently in Phase II clinical studies under the auspices of
the European Organization for Research and Treatment of Cancer. Von Hoff also
notes the importance of the first minor groove binder having now been approved
by the EMEA, the so-called European FDA.
From
the standpoint of the compatibility Williamson and Singer determined early-on,
Singer expands on the issue by noting that CTI has infrastructure SMi can
leverage and SMi, through TGen, has extensive genomic platform and
high-throughput capabilities to target a cancer drug's
'context-of-vulnerability', guiding clinical trials toward patient populations
where the highest likelihood of success should be observed, with the goal of
lowering risk and shortening time to market. Code: E100715
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