Biogen Idec Inc. began refocusing in autumn, when it cut 17 percent of its staff and decided to divest Amevive, its psoriasis product that had disappointed, in terms of revenue.

The drug was unloaded in April for $60 million in cash and future royalties, and the restructuring effort was estimated to save Biogen Idec, of Cambridge, Mass., about $200 million to $300 million annually.

Biogen Idec had spent much of 2005 reeling after the withdrawal of multiple sclerosis drug Tysabri from the marketplace because of patient deaths linked to progressive multifocal leukoencephalopathy. Shares dropped 31.7 percent last year, and cutting back seemed in line.

That belt-tightening has been replaced by spending. Biogen Idec on Wednesday said it was acquiring Fumapharm AG, of Lucerne, Switzerland, making it the company's second acquisition in May - the first being Conforma Therapeutics Corp. for $150 million, plus another $100 million hinged on milestones. With Tysabri cleared this week for a return to market, the vibe around Biogen has changed.

The Fumapharm deal brings aboard Fumaderm, a psoriasis drug cleared in Germany, and gets Biogen Idec full rights to BG-12, which the companies have been collaborating on since fall 2003.

Biogen Idec will pay an undisclosed amount of cash for all the outstanding shares of Fumapharm, and the move has been approved by both boards; it is expected to close in the next two months. Fumapharm's CEO and chairman, Hans Strebel, will step away, and Fumapharm will be established as a wholly owned subsidiary, at least for the short-term, said Biogen Idec's director of public affairs, Jose Juves.

Calling the buyout "a mutual decision," he pointed to BG-12 as a main impetus for the deal.

"Biogen is going to get the remaining interest of BG-12, and that will allow us to fully integrate this into our MS portfolio," he said.

Biogen Idec had in-licensed worldwide rights, except Germany, for BG-12 in October 2003. The drug is an oral fumarate derivative that works by an immunomodulatory approach. It also is a second generation of Fumaderm, so at the time of in-licensing, it might have been assumed that Biogen was looking for another psoriasis product.

While the drug has potential there, Biogen Idec on Tuesday released positive Phase II results of BG-12 in relapsing-remitting MS, showing the drug hit its primary endpoint - a statistically significant reduction vs. placebo in the total number of gadolinium-enhancing brain lesions. Juves admitted that observers now have caught on that Biogen Idec is first interested in the drug in multiple sclerosis, and he said Biogen Idec hopes to enroll the first patients in a MS Phase III trial early next year.

But psoriasis will get attention, too. In April 2005, the companies reported a successful Phase III in moderate to severe psoriasis. Although the study involved 175 patients and was used as the basis for a German filing, the application was later withdrawn by Fumapharm.

"That was a joint decision, based on developing a strategy to make BG-12 available to patients beyond Germany," Juves said - in other words, in favor of an overall EU approval. That almost certainly would require more clinical work, and Biogen Idec's job now is to "define a development plan for BG-12 in psoriasis and other potential indications," Juves said.

A bonus for Biogen Idec is Fumaderm, which brought Fumapharm CHF16 million (US$13.2 million) in 2005 from German sales. Fumapharm's size - Juves called it a "very small company, in terms of people" - required contracting out both Fumaderm manufacturing and sales. Biogen would leave that template alone.

"What Biogen will be doing, it would continue to support the sale and manufacture of Fumaderm throughout that existing network" and take in the profit, Juves said. There are no plans to seek additional approvals or growth.

Biogen Idec is well known for its MS drugs. Avonex celebrated its 10th anniversary as a marketed product last month - Biogen Idec CEO James Mullen rang the opening bell May 19 at Nasdaq to honor the event - and the drug pulled in $1.5 billion in 2005. Tysabri, while certainly troubled, was once thought to be a potential blockbuster and looks ready to return to the market in some form.

But in psoriasis, the firm has been less successful. It developed Amevive (alefacept), which some suggested could bring in anywhere from $200 million to $400 million last year; instead, it brought Biogen Idec just $48.5 million. The first approved biologic (early 2003) for moderate to severe chronic plaque psoriasis, Amevive eventually faced tough competition from Remicade (infliximab, Centocor Inc.), Enbrel (etanercept, Amgen Inc.) and Humira (adalimumab, Abbott Laboratories).

That market remains competitive, but up first for BG-12 is MS, so considering how it might be positioned in the psoriasis field "at this point, would be speculating," Juves said.