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AstraZeneca and CAT in long-term research partnership

Published on 24/11/04 at 04:16pm

AstraZeneca has announced a five-year research and development alliance with Cambridge Antibody Technology for the joint discovery of antibody drugs, one of the fastest growing classes of medicines.

The pharma giant's move into biotechnology-based drugs, according to John Patterson, head of product safety and licensing at AstraZeneca, is part of a long-term strategy to get a foothold in an area where it has lagged behind its rivals.

AstraZeneca has bought just under 20% of the company, paying a 30% premium on the shares and providing a welcome boost to the UK biotech's available funding.

The new collaboration is likely to increase the number of new medicines CAT develops, and is structured around a five-year discovery initiation phase during which the partners will jointly initiate a minimum of 25 discovery programmes.

The alliance will be co-funded and co-managed by the partners and will be based on an innovative and flexible arrangement whereby either of the two companies can choose to opt in or out of development at different stages.

Significantly, the deal allows AstraZeneca to opt-in to existing CAT drugs in development, while the biotech company has the option of co-marketing drugs with its partner in the US market.

The principal focus of the discovery programmes will be in inflammatory disorders, but the research may extend to other therapeutic areas.

Sir Tom McKillop, chief executive officer of AstraZeneca, said: "I see this alliance with Cambridge Antibody Technology as a major component of AstraZeneca's strategy to develop new therapeutics for inflammatory and respiratory diseases. Both partners are combining their expertise and making a significant commitment of resources to the alliance."

Peter Chambre, chief executive officer of CAT said: "This innovative alliance with a world leader in the field of inflammatory diseases represents a major strategic move by both companies," and hailed AstraZeneca's vision in creating what he called  "a new model" of collaboration between pharma and biotech.

"Not only will it enable CAT to deploy its full range of capabilities and expertise in the early stages of product development, but it will also allow us to enhance our capabilities in the later stages and, for the first time, potentially participate in product commercialisation.

"Most significantly, CAT will share directly in the successes of products which result from the collaboration and it is therefore an important and exciting opportunity for us to make a significant advance in our transition to a product-based biopharmaceutical company."

Earlier this year medium-sized Belgian company UCB acquired Celltech, the UK biotech company, seen as Europe's guiding light in terms of biotech potential.

Meanwhile, Roche has seen its fortunes revived in 2004, thanks largely to its part-ownership and collaboration with Californian biotech Genentech, which developed novel cancer drugs Herceptin and Avastin.

Ruth Stone, managing partner, of RSA Consulting believes the AstraZeneca-CAT alliance is part of the trend towards closer integration between the major pharmaceutical and biotech companies.

"Pharmaceutical companies are increasingly in-licensing new molecules from the biotechnology sector to bolster the ailing pipelines that have emerged in the wake of major industry consolidation."

The CAT deal comes at an unsettled time for AstraZeneca, its shares falling more than 20% this year amid fears over the safety of Crestor and a serious setback in the approval of Exanta in the US.

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