Bayer has signed a major deal with Genzyme Corp, including the transfer of its haematological oncology portfolio, and certain rights to Campath, which could net the German group up to $2.8 billion.

Genzyme is buying back worldwide development and distribution rights for Campath/MabCampath (alemtuzumab), the firms’ treatment for B-cell chronic lymphocytic leukaemia. Bayer is also selling the rights to Leukine (sargramostim) and Fludara (fludarabine) and in return will receive milestones and royalties, depending on sales achieved by Genzyme, amounting up to $650 million.

The cornerstone of the deal is Campath and Bayer is transferring most of its rights for the development of the drug as a potential treatment for multiple sclerosis. However, the Leverkusen-headquartered firm will continue to partially fund development of alemtuzumab in MS and has retained a co-promotion option in that indication, plus rights to develop Campath in solid organ transplant indications.

If Campath gets approved for MS treatment (Genzyme is currently conducting two Phase III studies in that indication), Bayer will receive royalties over a ten-year period of between 20%-35% of revenues achieved by Genzyme, up to a maximum of $1.25 billion. Bayer may also receive “substantial sales-based” payments if the US firm does not buy out its milestone obligation in 2020 for an amount in the range of $625-$900 million.

Other elements of the deal will see Genzyme acquire a new Leukine manufacturing facility in Seattle for $75-$100 million. Bayer has been selling the drug in the USA for use following induction chemotherapy in older adults with acute myelogenous leukaemia and Leukine sales last year were 46 million euros.

Fludara, an injectable second-line therapy for B-CLL, brought in 100 million euros to Bayer’s coffers while Campath sales reached 76 million euros in 2008. Genzyme says that the three drugs should have revenues of $185 million in 2009 or up to $700 million over the next three years.

Explaining the rationale behind the deal, Genzyme chief executive Henri Termeer said alemtuzumab is “a potentially transformative therapy for the treatment of MS, and an important part of our future”. The transaction “clarifies the responsibilities of each company and gives Genzyme control over the execution of this programme,” he added, noting that “we will continue to collaborate with Bayer in a more streamlined and focused way”.

Arthur Higgins, head of Bayer Healthcare, said the agreement means that the two firms “are better aligned to maximise the opportunity for alemtuzumab in both oncology and MS, and frees up resources to accelerate the development of Bayer’s exciting oncology pipeline,” notably Nexavar (sorafenib).

Job boost for Genzyme UK
Jobswise, approximately 330 Bayer positions worldwide will be affected by this agreement, of which 250 will go in the USA and 20 in Europe. However, it will lead to the creation of a number of new sales and marketing jobs at Genzyme’s Transplant and Oncology unit in Oxford, UK. Genzyme says it is “actively recruiting for several positions in haemotology/oncology already”.