Celltech Gets Second Bite of CDP 870 Cherry

01 Jan 2004

• By Hazel Dawson

When Big Pharma companies hand back licensed products to their biotech originators it's generally considered bad news for the biotech. But it needn't always be so. Pfizer's decision to return rights to Celltech's anti-inflammatory antibody CDP 870 hit Celltech's share price hard, but could ultimately open up a wealth of options and opportunities to the company.

In mid-November, Pfizer Inc. unpleasantly surprised UCB Celltech 's investors by putting the CDP 870 Phase III rheumatoid arthritis (RA) program on hold. That it wanted to renegotiate the terms of the licensing agreement came completely out of the blue and led to a 20% dive in Celltech's share price. Few were surprised however, when just two weeks later, having failed to convince Celltech to accept new, altogether less favorable terms, Pfizer announced it would hand back all rights to the compound.

When a Big Pharma hands back a licensed product to its biotech partner, for other than anti-trust reasons, it's generally...