MorphoSys said yesterday it has regained rights to the multiple myeloma compound MOR202 from Celgene after the companies “mutually agreed” to terminate a 21-month-old co-development and co-promotion agreement.

The companies did not disclose financial details related to termination of their collaboration, which could have generated up to €628 million ($818 million when announced in June 2013, but only $683 million today) plus royalties.

MOR202 is a fully human HuCAL-antibody directed against CD38, a therapeutic target for the treatment of multiple myeloma and some forms of leukemia.

MorphoSys said the end of the collaboration will not affect a Phase I/IIa MorphoSys-sponsored trial of MOR202 in relapsed or refractory multiple myeloma patients. That trial will continue, the company said.

As of its most recent update on March 18, MorphoSys was recruiting patients for the Phase I/IIa trial (NCT0 01421186), according to ClinicalTrials.gov. The open-label, multi-center, dose escalation study is intended to characterize the safety and preliminary efficacy of MOR202 in adult subjects with relapsed/refractory multiple myeloma; as monotherapy; and in adult subjects with relapsed/refractory multiple myeloma in combination with standard therapy.

The study’s estimated primary completion date is December 2016, with an overall completion date of May 2018. In its statement today, MorphoSys said it “aims to release” first clinical data from the trial “at a medical conference in 2015.”

“We are committed to continuing the development of MOR202 as there is a high unmet medical need for new treatment options in multiple myeloma,” said Arndt Schottelius, M.D., Ph.D., MorphoSys’ chief development officer, said in a statement.

“Based on preclinical data, we see significant promise in combining MOR202 with Celgene's [Revlimid®] lenalidomide and [Pomalyst®] pomalidomide in clinical trials which will commence soon,” Dr. Schottelius added.

Cohorts in which MOR202 is combined with lenalidomide and with pomalidomide will be added to the Phase I/IIa trial during the first half of this year, the company added.

“This program is a valuable component of our proprietary portfolio, and we are looking forward to presenting clinical data in the near future,” stated MorphoSys co-founder and CEO Simon Moroney, Ph.D.

Investors, however, appeared not to share Dr. Moroney’s optimism, reacting to the end of the collaboration with Celgene by selling off MorphoSys shares, causing its stock price to fall 20%—the company’s biggest one-day drop since 1982, Bloomberg reported.

MorphoSys raised its revenue, earnings, and R&D expense projections for 2015. As a result of the termination, the company said, it now expects revenues of between €101 million and €106 million (about $110 million and $115 million)—nearly double the earlier projected range of €58 million to €63 million ($63 million to $68.5 million), reflecting full realization of deferred revenues from the original agreement with Celgene and a one-time payment from Celgene for development costs in 2015.

MorphoSys also said it expects earnings before interest and taxes of about €9 million to €16 million ($9.8 million to $17.4 million), up from a loss of between €20 million to €30 million ($21.8 million to $32.6million). R&D expenses—including the development costs for MOR202 for the remainder of the year—however, are now projected to rise to between €56 million and €63 million ($60.9 million and $68.5 million), up from between €48 million to €58 million ($52.2 million to $63 million).








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