Micromet marks its move to Md. with $167 million licensing deal

Daily Record, The (Baltimore), May 25, 2007 by Karen Buckelew

Micromet Inc. has marked its first months as a Maryland-based biotechnology company with a new licensing deal possibly worth as much as $167 million.

The 100-employee therapeutics firm signed a lease for office space in Bethesda on April 1 and began to move its corporate headquarters from Carlsbad, Calif.

After just weeks in its new offices, Micromet Thursday announced a worldwide collaboration deal with Danish firm Nycomed for the development of a human antibody for the treatment of inflammatory and autoimmune conditions.

Privately held Nycomed owes Micromet a $7 million upfront payment, according to terms of the deal, and milestones of about $160 million through the development process.

Micromet's shares, traded as MITI on the Nasdaq, surged as much 33.45 percent, or 82 cents, Thursday before closing up 12.24 percent at $2.75.

The company's technology centers on antibodies, a method of developing them and a system of targeting tumors with cancer- killing agents, known as BiTE.

"Its obviously part of our strategy to make partnerships and retain various types of rights" to the technologies the company has developed since its 1993 founding in Munich, said President and CEO Christian Itin.

Partnerships are key to Micromet's business plan - its lead product candidate is a treatment for non-Hodgkins lymphoma developed since 2003 in conjunction with Gaithersburg-based MedImmune Inc.

That therapy, in fact, is part of MedImmune's strength in biologics, which was a major attraction for English firm AstraZeneca in its $15.6 billion acquisition bid for MedImmune.

Micromet's close relationship with MedImmune was part of the reason the company sought to relocate on the East Coast, and in Montgomery County in particular, Itin said.

The company's Bethesda offices will hold 10 of its 100 employees; the rest will remain at its research and development facility in Munich.

"There were a lot of good reasons for us to actually choose Bethesda or another location within Maryland's [Interstate] 270 corridor," Itin said.

There was the proximity to MedImmune, he added, and a simpler reason - the time difference between Munich and Carlsbad is nine hours. The difference "makes corporate life a little more complicated than it should be," Itin said.

The is pleased to add another name to the more than 200 bioscience firms that call it home, said Janis Peters, a senior business development specialist.

"It's a huge cluster," Peters said of the county's industry. "Biotech companies are unlike other tech companies. They are competitive, but they tend to need to be near each other."

That's because of the companies' reliance on a skilled work force and strong infrastructure and the availability of other firms for partnering, Peters said.

Partnering has been a key part of Micromet's business model for funding the development of its technology, and the new Nycomed deal is no exception, Itin said.

Nycomed has a long history of success with anti-inflammatory drugs, the CEO explained, and its expertise will be key to the compound's development.

Micromet is in the process of preclinical studies on the drug, and if all goes well and the therapy is ready for human testing in 2008, Nycomed will take over.

The Danish company will pay Micromet not only milestone fees throughout development, but royalties should it market the product through its worldwide, exclusive license.

The financial terms of Micromet's arrangement with MedImmune, which is similar to the Nycomed deal, never have been disclosed, Itin said.

Another similar development deal with drug company Merck Serono is worth a potential $138 million in milestone payments, according to federal regulatory filings.

All of Micromet's revenue comes from such partnerships. The company reported $27.6 million in revenue for last year, up from $25.7 million the year before.