Catco Reinsurance Opport... Share Discussion Threads

[danny_boffin] 10/12/2004 16:36

Is the trial now officially over, in that we are now just waiting for a judge's verdict?

Be a nice christmas present if he rules in favour of 5% royalties next week!

[matthu] 10/12/2004 16:23

CAT has circulated it's closing statement.

I've had a brief read of it. CAT's case appears to the untrained eye (i.e. mine) to have been strengthened by events in the court room. Comments by the judge, disputes between witnesses etc.

I have topped up in CAT at 604 p.

[bergster56] 10/12/2004 14:50

afternoon people. There's a newly listed company called Armorgroup international (arg) with 1 st day of trading today. Its one i've been researching for the past 9 weeks. I've posted all my researchon the ARG thread if anyone interested. Its a private military company with operations in iraq

[matthu] 10/12/2004 06:29

The fact that Abbott felt the need to dump their legal team bodes well ...

[dancer03] 10/12/2004 00:08

Little snipet I noticed.....at the bottom of the page.

[matthu] 08/12/2004 09:20

On another topic


Micromet, Serono Enter Cancer Drug Deal Worth Up To $148M
By Karen Pihl-Carey - Staff Writer

In a deal just shy of $150 million, Micromet AG partnered with Serono SA its Phase II monoclonal antibody, MT201, designed to treat prostate and metastatic breast cancer.

While Munich, Germany-based Micromet will complete Phase II trials in those indications, Serono immediately is taking over all development costs, and it gains worldwide rights to develop the product further, as well as commercialize it.

"It is a substantial and very significant agreement for Micromet," said Evelyn Wolf, a spokeswoman for the company. "If you're looking at the profile and features of this compound, this agreement really allows us to develop this compound to the full potential."

MT201 (adecatumumab) is directed against the epithelial cell-adhesion molecule EpCAM. Final results of the two multicenter Phase II trials are expected in the middle of 2006, at which time Serono and Micromet will finalize Phase III plans.

Under their agreement, Micromet receives an initial license fee of $10 million, and would get additional milestone payments of up to $138 million if MT201 is developed and approved worldwide in three or more indications.

"This compound has a potential in all major carcinomas," Wolf told BioWorld Today. A third indication for MT201, beyond prostate and breast cancers, could be cancers of the lung, colon, stomach, bladder, pancreas, head and neck, and ovaries.

At the time Micromet and Geneva-based Serono move the product from a Phase II program into a Phase III program, Micromet has the option to co-develop and co-promote MT201 in the U.S., Europe, or both. If the option is exercised, the companies would share profits. If not, Micromet would receive royalties. Wolf would not give further details of the profit split or the royalties.

And she said it is premature to estimate potential peak sales for MT201, but the breast cancer market is expected to reach $7 billion worldwide in 2006, and the prostate cancer market for the U.S., Europe and Japan could reach $7.3 billion in 2011. MT201 might offer a safety advantage over existing therapies, according to Phase I data.

"One feature you need is a very low immunogenicity and high safety of the drug because you need to reach relatively high serum levels," Wolf said.

MT201 was designed to selectively eliminate tumor cells, leaving healthy tissues unharmed. Clinical testing so far has shown no MT201-neutralizing antibodies. Micromet began the European Phase II trial of MT201 in metastatic breast cancer last March. The trial is enrolling 100 patients. Micromet recently received the go-ahead from the FDA to begin Phase II studies of the product in the U.S.

The fact that MT201 targets EpCAM broadens its prospects in treating several different types of cancers, Wolf said.

"EpCAM is not only present, but it's actually overexpressed in the majority of those carcinomas," she said.

Micromet gained a nonexclusive license to MT201 in September 2003 from Cambridge Antibody Technology Group plc, of Cambridge, UK, which developed the compound with its phage display technology. Micromet received a worldwide license to all of CAT's antibody phage display technology patents to develop antibody-based products targeting the EpCAM antigen. CAT received an up-front license fee and is entitled to milestone and royalty payments on products developed by Micromet and its partners.

With the latest agreement, Micromet's MT201 will be added to Serono's cancer portfolio, which includes TACI-Ig, a product in two clinical trials for B-cell malignancies.

"Serono is very committed to further developing our presence in oncology, both via our in-house research and via partnerships," said Andrew Galazka, Serono's senior vice president of scientific affairs.

Galazka added that the partnership with Micromet "demonstrates both the evolution of our portfolio of novel anticancer agents, as well as our commitment to addressing unmet medical needs."

Privately held Micromet was founded in the mid-1990s as a spinout from Munich University. The company currently has 96 employees and two products in clinical development. Its second product is MT103, a molecule based on Micromet's BiTE (Bispecific T-cell Engagers) technology. It is in Phase I development for non-Hodgkin's lymphoma, and is partnered with Gaithersburg, Md.-based MedImmune Inc.

At the preclinical stage, Micromet is studying another BiTE molecule, MT-110, for solid tumors, as well as an anti-inflammatory drug that targets GM-CSF.

[matthu] 08/12/2004 09:10

I wouldlove top be able to read the opinions of people who taken the opposite view, but so far I haven't found any. Tried to find something on the Abbott web site, but this case seems to be so small it is off their radar ...

[dancer03] 08/12/2004 05:04

If no news by next week, I hope to be able to top up (work bonus on 17th). A little bit of a gamble but I think the odds are still on CATS side.

[dancer03] 07/12/2004 23:02

I agree, this is basically a judgement on ambiguous points within the contract. I would frankly be disgusted if the courts rule that Abbott can keep CAT down to 2%.....they discovered (through their patented technology)the antibody responsible for Humira for fu*ks sake.

[matthu] 07/12/2004 16:16

3 weeks I think. Then judgement may be deferred until sometime in January - although I don't get the impression that the case is as complicated as cases which truly involve patent law.

This case is simply contract law.

[danny_boffin] 07/12/2004 16:12

It must be getting close to the end of the trial now - wasn't it supposed to last 2 weeks?

[matthu] 07/12/2004 16:10

Price has suddenly climbed 4% today. Wonder what the action is in the high court?

[danny_boffin] 02/12/2004 15:47

matthu - thanks

[matthu] 02/12/2004 15:15

CAT has recently (today or yesterday) released five additional witness statements. These are available to anybody who emailed them requesting to receive such documents - see company announcement. They make fascinating reading.

I assume that CAT's witnesses have been presenting (or are still presenting) evidence, and that Abbott's witnesses have yet to take the stand.

[danny_boffin] 02/12/2004 15:04

Anyone know what's been going on in the courts over these last few?

[graemereid] 26/11/2004 21:20

Matthu,
Interesting reading indeed. It is, of course impossible to judge the legal intricacies as far as the eventual outcome is concerned but I do wonder why Abbott are risking their reputation as plausible partners from smaller biotechs in this way. If they lose in court they will lose more than this case and even if they win ...

[matthu] 25/11/2004 09:41

From The Guardian:
· Cambridge Antibody Technology, a UK biotech, yesterday released details of its claim against US giant Abbott Laboratories, which it is suing for a bigger slice of the sales of Humira, the rheumatoid arthritis drug, which is forecast to have sales of $1.2bn next year.

CAT helped Abbott to find the right human antibody to reduce the effects of arthritis in the mid-1990s.

It is asking for 5% of sales rather than the 2% Abbott is giving, which would be significant income for the loss-making firm.

Nicola Dagg, a patent expert at Lovells law firm, said that the case looked "attractive" for CAT. If the judge decides the contract is ambiguous then the court will look at how important CAT's work was to the development of the drug.

[graemereid] 25/11/2004 06:48

matthu,

Many thanks for clearing up my misreading of your earlier post! I've E-mailed them.

[matthu] 24/11/2004 19:27

The deadline was a deadline BEFORE which you should NOT request the documents. I see no reason why they should not still be available.

[graemereid] 24/11/2004 19:04

matthu,

does this mean that you are prohibited from forwarding the documents? I not only have a holding in CAT but have a scientific interest. Actually I used the Humira as an example last week of a top biotech application and gave some of the corporate background to our students. I'd be very interested in seeing the documents but just saw you posting re the deadline for requesting the documentation so i assume I ca't get them any more from CAT.

[matthu] 24/11/2004 16:59

I received 5 documents from [e-mail] relating to the court hearing, of which the opening address by CAT legal team makes interesting and imperative reading.

It gives a good background to the technology (for the layman), it gives details of royalty rates and also gives the whole background to the contract negotiation - 112 pages altogther.

I don't think I can post any quotes here - there is a strictly worded warning about copying, and as these documents emanated from the High Court, I'd rather stick to the letter of the law!

[matthu] 22/11/2004 21:33

as reported in

Abbott's Bid to Squeeze Royalties May Carry Wider Impact
Outside Audit

By LEILA ABBOUD
Staff Reporter of THE WALL STREET JOURNAL
November 22, 2004; Page C1

Abbott Laboratories rejuvenated its drug business when it acquired biotechnology drug Humira, an arthritis treatment. But now that the medication is doing well, the drug giant is trying to muscle its biotechnology partners into accepting lower royalties, a gambit that could complicate its future negotiations to obtain promising biotechnology drugs.

The outcome of a legal battle between Abbott and one of its partners, Cambridge Antibody Technology Group PLC, also could affect a little-discussed but financially crucial drug-industry practice known as "royalty stacking." The two companies face off in Chancery Court in London today, and the case is being closely watched by other biotechnology firms, which increasingly are linking up with big pharmaceutical companies and are worried about their licensing contracts.

Cambridge aims to stop Abbott Laboratories from cutting the annual Humira royalties it pays to Cambridge to 2% of revenues from 5%. Humira is crucial to Abbott's bottom line in coming years; the treatment carries an annual price tag of $14,000 a patient and is forecast to hit $1.2 billion in sales in 2005.

Biotechnology drugs often have a thicket of patents, ranging from a drug's target treatment to the specific methods used to produce it in the laboratory and on the factory floor. So drug companies often have to enter licensing deals with many parties -- including academic institutions and several biotechnology firms -- to get a drug to market. This is especially true of so-called targeted therapies, because patents cover every aspect of making these promising and costly treatments for cancer and other serious diseases.

All told, royalty payments to entrepreneurial biotechnology companies can eat up 10% or more of big pharmaceutical companies' revenue on these kinds of biotechnology drugs.

Contracts between pharmaceutical and biotechnology companies are shrouded in secrecy, but Abbott isn't the only major drug company that enters such partnerships: Most drugs companies that make traditional, chemically based drugs -- including PfizerInc., Eli Lilly & Co., and GlaxoSmithKline PLC -- have been trying to break into biotechnology drugs to stock their dwindling pipelines.

Used to earning fat profit margins on the drugs they develop in house, pharmaceutical companies are having to adjust to smaller margins on biotechnology treatments, in part because of royalty obligations. In some cases, like Abbott's, the companies are pushing back and trying to renegotiate the terms of licensing deals, even long-established ones.

In the Humira case, Abbott inherited the licensing obligations it owed to Cambridge and three other companies from a German company, Knoll, which Abbott bought in 2001 for $6.9 billion. Abbott began selling Humira in 2003.

But last year, Abbott began what a company spokeswoman called a "routine review" of Knoll's contracts and licenses. After the review, Abbott contacted at least three companies to discuss the terms of the licenses Knoll had made on Humira. In each case, Abbott sought to reduce the amount it owed.

Melissa Brotz, an Abbott spokeswoman, says Abbott didn't set out to ratchet down the royalties it paid on Humira. "We looked at all the contracts and made individual decisions based on each contract," says Ms. Brotz. "It's routine business practice for us to review our contracts to make sure they are accurate and appropriate."

In October 2003, Abbott tried to renegotiate its license with Peptech Ltd., a small Australian company that holds various patents on the therapeutic uses of antibodies to TNF, a protein that plays a major role in inflammation. Humira and the other drugs in its class -- such as Johnson & Johnson's Remicade and Amgen's Enbrel -- all work on TNF to treat autoimmune diseases like Crohn's disease and psoriasis.

Abbott argued that Humira didn't infringe on Peptech's patents and that the Knoll license wasn't appropriate. Peptech resisted at first, but quickly settled. The terms of the deal weren't made public, and both companies declined to comment.

Next on Abbott's list was Cambridge. In 1993, Cambridge was hired by Knoll to synthesize fully human antibodies to several drug targets. Under the contract with Knoll, Cambridge was entitled to milestone payments and royalties of about 5% on the revenues of any drug that emerged from the effort.

But after the acquisition, Abbott interpreted a crucial part of the contract, known as an "offset provision," differently. The contract provision allowed Knoll to reduce Cambridge's royalties if it turned out that Cambridge wasn't the sole owner of the key method used to make the antibodies. The clause was needed, because Cambridge had applied for but not finalized all the relevant patents.

Abbott now asserts that the offset provision means it can take out of Cambridge's fees any royalties payable on the product, including those paid to other companies.

The two sides couldn't agree on a settlement, which is why they are squaring off in a British court. The outcome of the litigation also will apply to several more compounds from the collaboration with Cambridge, including one promising drug now in early trials. Abbott also pays royalties on Humira to Genentech Inc. and Serono AG. Abbott approached Serono to discuss terms of the Humira license, but neither company will speak publicly about that arrangement.

The Cambridge dispute shows the extent to which Abbott is going to shore up its high-margin pharmaceutical division, where several big drugs face generic competition. For example, Thyroid medicine Synthroid, with annual sales of $610 million, is already generic, and the $1.2 billion antibiotic Biaxin could go generic in 2005. Abbott had revenue of $19.7 billion last year.

Some on Wall Street already have sounded the alarm over Abbott. Matthew Dodds, a Citigroup analyst, says Abbott may be squeezing the royalty rate on Humira to improve its gross margins. "They can't fix the margin pressures with new drugs, so they're looking to squeeze more profitability out of current drugs," he says.

Abbott dismissed these concerns about gross margins, citing strong sales of its current portfolio of drugs and its seven pending applications at the Food and Drug Administration as signs of the health of its pharmaceutical business, and Ms. Brotz, the spokeswoman, says "the outcome of [the Cambridge] trial is not material to the company."

Nevertheless, the dispute could have long-term consequences for Abbott if it damages its reputation as a good partner. Indeed, biotechnology executives ranked Abbott the worst company to link up with, in a survey done in November 2003 by the consulting firm Cambridge Healthcare & Biotech. The firm isn't connected to Cambridge Antibody.

Abbott says its dispute with Cambridge Antibody isn't unique in the industry, and won't affect its relations with biotechnology companies. Abbott said it averages about 50 new agreements with biotechnology companies each year. "We're a good partner for dozens of biotechs," says Ms. Brotz.

Write to Leila Abboud at [e-mail]

[matthu] 22/11/2004 21:17

CAMBRIDGE, England, Nov. 22 /PRNewswire-FirstCall/ -- Cambridge Antibody
Technology (LSE: CAT; Nasdaq: CATG) today announces that, during the course of
today's hearing in the High Court in London, following an application from a
third party, the judge made an order that certain court documents including
opening submissions could be made available to third parties.
Copies of such documents will be available upon request from CAT's
corporate communications team on [phone] or by emailing
[e-mail] not before noon GMT on 23 November
2004.

[matthu] 22/11/2004 17:04

I honestly don't know. It's not a criminal case.

But even then, the trial is anticipated to last three weeks i.e. until mid-December, and judgement is only anticipated early in 2005.

So it seems that even after all the argument has been made, the judge will still need time to consider the weight of argument very carefully. In the light of that, I consider it unlikely that any non-legal person could draw any provisional conclusions on a daily basis ...