CAT Catco Reinsurance Opportunities Fund Limited

RNS Number:0737D
Cambridge Antibody Tech Group PLC
24 December 1999


For Further Information Contact:
Cambridge Antibody Technology Group plc
Dr David Chiswell, Chief Executive Officer       Tel: +44 (0) 1763 263233
John Aston, Finance Director
Rowena Gardner, Communications Manager

HCC.De Facto
City/Financial, Sue Charles/Rebecca Hennessy     Tel: +44 (0) 171 496 3300
Trade, Nikul Odedra
            
       
CAMBRIDGE ANTIBODY TECHNOLOGY AND SEARLE 
FORM MAJOR DRUG DEVELOPMENT ALLIANCE IN HUMAN HEALTHCARE

Exciting new initiative in cancer, linking high-throughput antibody generation
with genomics-based target discovery and the development of novel human
monoclonal antibody-based therapeutic products

Melbourn, UK   Cambridge Antibody Technology ("CAT") (LSE: CAT) today
announced a multidisciplinary strategic alliance with Searle, the
pharmaceutical business of Monsanto Company (NYSE: MTC), for the development
of fully human monoclonal antibody-based therapeutic drugs across multiple
disease areas, focusing particularly on the field of cancer.  This is CAT's
largest alliance to date. 

The collaboration between CAT and Searle presents an unprecedented opportunity
to develop a pipeline of human antibody products for application in a wide
range of clinical indications.  The alliance combines CAT's expertise in
high-throughput antibody generation and development of human antibody drugs
with Searle's impressive capabilities in genomics, discovery biology and drug
development.  CAT and Searle will both commit technology, intellectual
property and expertise to the alliance. Searle will supply target proteins,
including those derived from its own internal discovery programmes, and both
companies will perform collaborative research to demonstrate and validate
their disease association. As part of the target validation process, CAT will
apply its proprietary ProAb technology for high throughput antibody generation
to examine the expression of novel proteins in human tissues. CAT and Searle
will jointly develop customised assays and CAT will generate high potency
human antibody-based drugs directed to the targets.  Searle will develop
further and market the drugs.

Under the terms of the agreement, an affiliate of Searle will make an up-front
equity investment in 1,870,837 ordinary shares of CAT for the sterling
equivalent of US$12.5 million, giving it an equity stake of approximately 6.9
per cent in CAT.  The investment is subject to approval by CAT shareholders
and will be made at a price of #4.15 per share, calculated as a 15% premium to
the average share price over the 20 trading days prior to this announcement.  

In addition, over the initial three year term of the research collaboration
Searle will commit to minimum research funding of US$14.5 million. CAT will
also receive milestone payments contingent upon the success of its technology
in the research and discovery programmes. Searle has the option to extend the
duration of the research collaboration to up to five years in total on similar
terms.  CAT has also granted Searle multi-site options to license, for
additional fees, CAT's antibody phage display library technology for use
in-house. 

In addition, over the potential five year term of the research collaboration,
CAT could receive a further US$35 million in license fees, research funding
and technical performance milestones.

If the expected number of antibody-based drugs are successfully developed and
receive regulatory approval, the scale of the collaboration offers CAT the
potential to receive an additional US$150 million in clinical development and
regulatory approval milestones. CAT will also receive royalties on sales of
both antibody-based drugs, and small molecule drugs developed by Searle where
CAT technology is used to validate a target.

"Searle views CAT as the leader in the field of phage antibodies", said Dr.
Philip Needleman, Co-President of Searle.  "We are confident that this
technology will deliver therapeutics of the highest quality as well as the
tools to enhance all stages of our drug discovery and development pipeline. 
We are happy to welcome CAT as a partner which offers a critical and
complementary technology to those we have already established for the
development of our next generation of therapeutics".

Dr. David Chiswell, Chief Executive Officer of CAT, commented, "This alliance
with Searle signifies an exciting stage in CAT's evolution as a drug
development company. CAT has pioneered the development of fully-human antibody
drugs and the high-throughput isolation of antibodies on a scale compatible
with the genomics era.  It is fantastically exciting to combine these skills
with Searle's outstanding capabilities in drug development to build a
partnership dedicated to creating customised drugs for treatment of human
disease.  As well as the huge potential for the development of novel
therapeutics, this agreement with Searle includes CAT's third ProAb alliance
with major pharmaceutical companies in 1999. This further underscores CAT's
commitment to delivering antibodies on an industrialised scale to add value to
the genomics-derived disease targets of the future.  The alliance is CAT's
largest to date and provides further endorsement by the pharmaceutical
industry of the potential for human monoclonal antibodies to fill the product
pipeline gap". 

The collaboration was facilitated for CAT by the US-based Ulysses Group.

Notes:

1. Cambridge Antibody Technology (LSE: CAT) is a UK biotechnology company
using its proprietary technologies in fully human monoclonal antibodies for
drug discovery and drug development.  Based in Melbourn, 10 miles south of
Cambridge, England, CAT currently employs around 150 people.  In March 1997,
CAT completed its initial public offering and listing on the London Stock
Exchange, raising approximately #41 million.

CAT has a world-leading platform technology for rapidly isolating fully human
monoclonal antibodies using phage display systems.  CAT has an extensive phage
display antibody library, currently incorporating around 100 billion distinct
antibodies. This library forms the basis for the company's strategy to develop
a portfolio of clinical development programmes and for discovering new drug
leads using functional genomics.  Four fully human therapeutic antibodies
developed by CAT are at various stages of clinical trials. 

CAT has a number of license and collaborative agreements in place with
pharmaceutical and biotechnology companies including: Eli Lilly, Pfizer, BASF
Pharma, Genentech, ICOS Corporation, Genetics Institute/BASF Pharma,
Wyeth-Ayerst, Human Genome Sciences and AstraZeneca.


2. Searle, the pharmaceutical sector of Monsanto Company (NYSE: MTC),
develops, produces and markets prescription pharmaceuticals worldwide.  The
company focuses its expertise on five therapeutic areas: arthritis,
cardiovascular disease, cancer, sleep and women's health.   Searle, the
leading arthritis company worldwide, is the largest provider of branded
prescription arthritis medications in the U.S. and is the first company to
bring COX-2 technology to this marketplace.  For more information on Searle,
access www.searlehealthnet.com




END
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