Celgene ($CELG) has walked away from its $818 million multiple myeloma co-development pact with MorphoSys less than two years after striking the deal. The decision means Celgene has nothing to show for the $92 million upfront payment it made in 2013, but MorphoSys was hit harder by the news.
Shares in Germany-based MorphoSys tumbled 20% in the wake of the decision, its biggest drop since 2002, according to Bloomberg. MorphoSys called the decision "mutual" in a press release to break the news, but gave few details as to why either partner would be willing to abandon the alliance. Back in 2013, Celgene called the drug at the center of the deal--MOR202--a "very attractive asset" for a "validated highly promising target," namely CD38. The lack of information as to why Celgene seemingly changed its stance so quickly led to speculation among biotech observers.
The worst case scenario for MorphoSys--and the one that was in the mind of investors who drove down its stock--is that Celgene was unimpressed by the Phase I data. A MorphoSys-sponsored Phase I/IIa trial is underway but the public is yet to see data from the trial. If Celgene saw something in the tolerability or efficacy data that suggested it was time to cut its losses, the future for MOR202 looks challenging at best. A more optimistic--but still downbeat--conclusion is that MOR202 is already too far behind drugs from Johnson & Johnson ($JNJ) and Sanofi ($SNY) to warrant further investment.
Regardless of the reasoning, the outcomes for Celgene and MorphoSys is the same. Celgene is left without a new candidate with which to defend its position in the multiple myeloma market, although it may have an as yet undisclosed asset or deal in the works that contributed to it deciding to back away from MOR202..................After readng this I recalled an MSB ann. some time ago here is part of it ...........................In a collaborative study with Dr Yago Nieto and Professor Elizabeth Shpall in the Department of Stem Cell Transplantation and Cellular Therapy at the University of Texas MD Anderson Cancer Center, Mesoblast's proprietary "off-the-shelf" cell product was used successfully to achieve rapid and significant expansion of haematopoietic stem cells from the bone marrow PBPCs of patients with multiple myeloma after residual cancer cells had been removed.......The new uses of Mesoblast's proprietary "off-the-shelf" cell product for bone marrow transplantation will continue to be developed under the Company's existing United States Food and Drug Administration (FDA) orphan drug designation for expanding haematopoietic stem and progenitor cell numbers in patients with haematologic malignancies, such as multiple myeloma......................We shall wait and see .....Cheers V
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