Enbrel Production To Get a Boost

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Enbrel Production To Get a Boost

SEATTLE POST-INTELLIGENCER REPORTER

04/16/2002

A new deal with Genentech Inc. will allow Immunex Corp. to produce more

of its star arthritis drug,

Enbrel, and help solve some of the supply problems that have hampered the

company's ability to grow

sales.

Though Immunex sold $762 million of Enbrel last year, the company has had

to limit the number of patients

treated with the drug. Immunex plans to add three new production sites by

2005, but the Genentech deal

will help increase the company's ability to make the drug in the interim,

the company said yesterday.

" This is really to augment midterm supply, " Immunex spokeswoman Robin

Shapiro said. " We are trying all

potential avenues to increase production and to plan for $4 billion worth

of capacity by 2005. "

Shapiro said all the manufacturing facilities under construction are on

schedule, including the first of

two Rhode Island plants, which is expected to open later this year. The

second Rhode Island plant is

scheduled to open in 2005, she said.

The deal, announced yesterday, allows Immunex to make its drug at

Genentech's South San Francisco

facility in 2004 and 2005, with a possible extension through 2006.

" This just gives us extra flexibility in terms of multiple places to make

Enbrel, " Shapiro said.

Enbrel, which was first approved by the Food and Drug Administration in

1998 as a treatment for

rheumatoid arthritis, is a significant force behind Amgen Inc.'s proposed

$16 billion takeover of the

Seattle company. Before the acquisition, Immunex executives said that

Enbrel sales could climb as high as

$4 billion a year by 2005. More recently, Amgen has said that it expects

Enbrel sales to hit $3 billion

by 2005.

Immunex is rapidly widening the drug's label, which will be a major

factor in hitting sales targets. In

January, the FDA approved Enbrel as a treatment for psoriatic arthritis,

and Immunex is also testing the

drug in patients with psoriasis and other diseases.

Mc Ragen analyst Latta said yesterday that the Genentech

deal was a good sign.

" It does suggest that the company is confident that demand will be strong

enough that they'll need extra

production capacity, " he said.

Immunex and Amgen will face new competition from other companies working

on similar drugs, including

Abbott Laboratories, which said last week that it filed with the FDA for

approval of its own rheumatoid

arthritis drug, D2E7.

Latta said yesterday that while the Genentech deal is good news for

patients and doctors, it's less

significant for shareholders.

Immunex's stock price has moved little this year. Latta said that though

the Amgen acquisition is not set

to close until later this year, in many ways Immunex is already seen by

Wall Street as a part of Amgen.

The stock closed yesterday at $28.92 a share, down 26 cents, or less than

1 percent.

" In a way, for shareholders this is relatively small, " Latta said.

" For other stakeholders, that is not the case. "

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-- By Marni Leffseattle Post-intelligencer Reporter