Cell Therapeutics (CTI) reports that it is buying Systems Medicine (SMi) in a stock-for-stock merger valued at $20 million. SMi stockholders could receive a maximum of $15 million in additional consideration, payable in either cash or shares of CTI common stock, upon the achievement of certain regulatory milestones.
CTI notes that one of the main highlights of this transaction is that SMi’s Phase II anticancer candidate, Brostallicin, will fill its pipeline gap. While CTI’s pixantrone and Xyotax are in late-stage development with launches expected in the first and second half of 2009, respectively, SMi’s drug has the potential to receive market approval by 2010.
Brostallicin is a DNA minor groove binding agent. "Brostallicin has a potentially unique ability to become more active in tumors that are resistant to other cancer drugs," according to Jack W. Singer, M.D., CMO at CTI. "The extensive preclinical profiling of this agent, coupled with the fact that the EORTC (European Organization for Research and Treatment of Cancer) has advanced Brostallicin to a randomized Phase II trial in first-line treatment of sarcoma as a result of a successful Phase II effort in patients with prior therapy, underscores the potential of this product."