BioWorld International Correspondent

LONDON - AstraZeneca plc, the new owner of Cambridge Antibody Technology Group (CAT) Ltd., sold the royalty rights to the antibody company's one marketed product, Humira, for $700 million.

The deal, with Royalty Pharma, of New York, ends any UK interest in a drug that is viewed simultaneously as emblematic of the country's high-quality science, and of its failure to capitalize on it.

Humira, an anti-TNF-alpha antibody discovered by CAT in the early 1990s and developed by Abbott Laboratories, of Abbott Park, Ill., had sales of $1.4 billion in 2005, and forecast sales of $1.9 billion in 2006. The blockbuster status rests on approval for rheumatoid arthritis and psoriatic arthritis. Sales are likely to increase following approval for treating ankylosing spondylitis in July, and last week's announcement from Abbott that the FDA granted Humira a priority review in treating Crohn's diseases.

A spokesman for AstraZeneca told BioWorld International that the decision to sell the royalties should be looked at from the perspective of where CAT is now. "As a subsidiary [of AstraZeneca] the requirement for such an income stream is removed. [CAT] is funded on a different basis from when it was a biotech," he said.

He added that AstraZeneca took the view that getting a single large payment now is lower risk than awaiting small annual sums, the size of which is not guaranteed.

AstraZeneca, of London, invested £75 million (US$139 million) in CAT in November 2004 for just less than 20 percent of the equity, as the basis of a research collaboration. It subsequently paid £567 million for the rest of the Cambridge-based company in May, in a deal that valued CAT (which had around £135 million in the bank) at £702 million.

One of the factors that cleared the way for the acquisition was the settlement in November 2005 of a two-year legal battle between CAT and Abbott over CAT's Humira royalty entitlement. CAT claimed it was due 5.1 percent while Abbott said the figure was 2 percent. The two settled on about 2.7 percent, plus a $255 million one-off payment for CAT's licensors, principally the UK's Medical Research Council, and five annual payments of $9.4 million.