GCOR Genencor International, (MM)

Genencor Expands Oncology Pipeline with Product Candidates From the National Cancer Institute (NCI) Licenses a Phase II Compound and a Preclinical Compound for B-Cell Malignancies PALO ALTO, Calif., Dec. 9 /PRNewswire-FirstCall/ -- Genencor International, Inc. (NASDAQ:GCOR) announced today that it has signed an exclusive worldwide patent license agreement giving it the right to develop and commercialize two therapeutic product candidates for cancer from the Public Health Service (PHS) and the National Cancer Institute (NCI). The two proteins, BL22 and HA22, are recombinant immunotoxins that specifically target cancers derived from B-cells that express the CD22 antigen. BL22 is currently in Phase II clinical studies for the treatment of hairy cell leukemia (HCL). Phase I clinical testing in subsets of treatment- refractory pediatric acute lymphoblastic leukemia (pALL), chronic lymphocytic leukemia (CLL) and non-Hodgkin's lymphoma (NHL) is also underway. HA22, an improved second-generation form of BL22, is in the investigational new drug application (IND) enabling stage of development for expanded subsets of patients with these hematologic malignancies. "This license agreement accelerates the evolution of Genencor's health care enterprise from a research-stage organization to a business emphasizing the development of highly specific and selective therapeutic products for oncology patients," said Mark A. Goldsmith, M.D., Ph.D., Genencor's senior vice president, Health Care. "These two compounds directed at unmet medical needs in hematologic cancer are expected to complement our internal development candidate, GCR-8886/2141 which targets solid tumors. We believe the mechanism of action, composition, manufacturing requirements, and stage of development for these new additions to our pipeline represent an exceptional fit with our capabilities, objectives and strategy." Hematologic malignancies, such as acute and chronic leukemia and lymphoma represent more than 67,000 new cancer diagnoses and over 25,000 deaths each year in the U.S. according to the American Cancer Society. In spite of advancements that have improved the rates of complete and partial remissions, curative treatment remains elusive for many of these patients. Under a Cooperative Research and Development Agreement (CRADA) to be signed in conjunction with the license agreement, Genencor intends to work in cooperation with Ira Pastan, M.D., Chief, NCI's Laboratory of Molecular Biology, and to assume responsibility for continued development of BL22 (renamed GCR-3888) including overseeing clinical development, supplying material for clinical trials at the NCI, and registration and commercialization as appropriate. Genencor also intends to initiate the development of the higher affinity compound, HA22 (renamed GCR-8015), in a broader range of CD22-expressing hematologic malignancies. Genencor also announced that it has reorganized its health care business to consolidate dedicated functions, contain costs, and focus resources on its three flagship development programs and follow-up research leads. Under the new structure, drug research, preclinical and clinical development, business development, regulatory affairs, and cGMP manufacturing will be integrated within a health care division reporting to Goldsmith. "Genencor's health care business, under Mark's leadership, has evolved from a broad, research-intensive, start-up phase to a development phase focused on products for oncology markets, " said Jean-Jacques Bienaime, Genencor's chairman and chief executive officer. "We believe that with the NCI relationship, this new organization will enable the creation of stockholder value within Health Care while more efficiently managing the overall costs of Genencor's R&D investments." Genencor also updated its guidance for the remainder of 2004. The company said it expects total 2004 revenues to remain in the range of $404 million to $406 million. The signing of this patent license agreement is expected to result in a 2004 expense of $1.8 million for license fees and clinical drug supply costs. In addition, concurrent organizational changes are expected to further increase 2004 expenses by approximately $1.8 million, but the Company expects these changes to result in a recurring benefit of approximately $4.8 million commencing in 2005. As a result, for the full 2004 fiscal year Genencor now anticipates research and development spending to fall in the range of $75 million to $76 million, net income available to common stockholders guidance to be in the range of $19 million to $20 million and earnings per diluted share (EPS) of between $0.31 and $0.33. The Company's prior EPS guidance was $0.38 to $0.40 per share. Genencor does not provide quarterly guidance. While more comprehensive guidance for 2005 will be provided upon the release of fiscal 2004 financial results in February 2005, Genencor currently expects its 2005 Health Care segment expenses to be about $4 million lower than its 2004 forecast since increased development costs associated with advancing the therapeutics pipeline are expected to be more than offset by savings from the organizational changes occurring within the Health Care segment. A conference call to discuss the licensing agreement and the reorganization has been scheduled for Friday, December 10, at 8:30 am Eastern, 5:30 a.m. Pacific. To access the call via webcast, please log on to the Internet at http://www.shareholder.com/genencor/medialist.cfm . Please connect to the website at least 15 minutes prior to the call to ensure adequate time to register and log on. The webcast will be made available at this URL, as well as posted to the "Investor Relations" section of Genencor's website, http://www.genencor.com/. You may also dial-in to the conference call at: 800-288-8961 (domestic), 612-332-0226 (international). A replay will be available for two weeks following the call at 800-475-6701(domestic) or 320-365-3844 (international). The access code is 758686. About Genencor Genencor International, Inc. (http://www.genencor.com/) is a diversified biotechnology company that develops and delivers innovative products and services into the health care, agri-processing, industrial and consumer markets. Using an integrated set of technology platforms, Genencor's products deliver innovative and sustainable solutions to improve the quality of life. Genencor traces its history to 1982 and has grown to become a leading biotechnology company, with over $380 million in year 2003 annual revenues. Genencor has principal offices in Palo Alto, California; Rochester, New York; and Leiden, the Netherlands. This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These include statements concerning plans, objectives, goals, strategies, future events or performance and all other statements which are other than statements of historical fact, including without limitation, statements containing words such as "believes," "anticipates," "expects," "estimates," "projects," "will," "may," "might" and words of a similar nature. Such statements involve risks and uncertainties that could cause actual results to differ materially from those projected. Some important factors that could cause actual results to differ include dependence on the efforts of third parties, such as PHS and NCI; dependence on new and uncertain technology and its uncertain application to new business ventures; regulatory actions or delays, or uncertainties related to product development, testing or manufacturing; ability to form and maintain strategic alliances; ability to complete certain transactions and realize anticipated benefits from acquisitions; dependence on certain intellectual property rights of both Genencor and third parties, such as PHS and NCI; the competitive nature of Genencor's industry; risks of obsolescence of certain technology; and the high risk nature of efforts to develop products such as BL22 and HA22 for the health care market, including the achievement of successful pre- clinical and clinical results. These and other risk factors are more fully discussed in Genencor's most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q filed with the United States Securities and Exchange Commission. The forward-looking statements contained in this release represent the judgment of Genencor as of the date of this press release. Genencor disclaims, however, any intent or obligation to update any forward-looking statements. DATASOURCE: Genencor International, Inc. CONTACT: Media, Valerie Tucker, +1-650-846-7571, or Investors, Thomas Rathjen, +1-650-846-5810, both of Genencor International, Inc. Web site: http://www.genencor.com/

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