Abbott nixes cancer drug alliance with Emergent BioSolutions

Emergent BioSolutions ($EBS) has suffered a setback in its campaign to expand into cancer drug development. Abbott Labs ($ABT) has decided to dump a partnership with Emergent on the development of the protein therapeutic TRU-016 against B-cell malignancies. Emergent acquired the experimental cancer drug in its 2010 buyout of Seattle-based Trubion Pharmaceuticals, which was acquired to help the buyer expand from infectious diseases into cancer and autoimmune disease drug development.

Rockville, MD-based Emergent, which is known for its development of anthrax vaccine, said Abbott terminated its partnership on TRU-016 through the process of prioritizing its drug portfolio. Still, Emergent plans to forge ahead on the TRU-016 program, which includes a Phase II study that recently got started in chronic lymphomcytic leukemia (CLL) and an ongoing Phase Ib in non-Hodgkin's lymphoma, according to the company. Data from those two studies are expected in 2013.

Abbott's obligations under the deal, which will expire March 20, remain in effect for a period. The Abbott Park, IL-based healthcare giant owes Emergent a $6 million milestone fee for the start of the Phase II, which tests TRU-016 in combination with the chemotherapy drug bendamustine for patients with relapsed cases of CLL, Emergent said. The company will get back full rights to the program once the pact expires.

Abbott's decision to cut its ties to the TRU-016 program comes after the company announced in October that it would spin off its pharmaceutical business into a separate entity from its medical products business. In general, large drugmakers have been quick to scrap licensing arrangements that don't fit into their remodeled pipelines, and they are demanding more for their research dollars to boost returns on their R&D investments.

- here's the release
- see Dow Jones Newswires' report

Special Report: The top 10 biotech deal terminations of 2011