Boost For Immunex From AHP Deal

Following news of its marketing agreement with American Home Products onthe rheumatoid arthritis drug Enbrel (tumor necrosis factor receptor), Immunex' share price rose five points to $64.75, with the Wall Street Journal noting that the deal will allow Immunex to maximize sales while also bolstering its cash position. Additionally, the deal provides for AHP to pay Immunex up to $100 million in milestone payments.

Under the terms of the deal, AHP subsidiary Wyeth-Ayerst has agreed to promote Enbrel for all indications, except oncology, for which Immunex holds promotional exclusivity and has an existing sales force presence.

Edmund Debler of Mehta & Isaly feels this is an outstanding and spectacular agreement, similar to that between two large companies. For a firm like Immunex to enter this kind of deal, he said, dramatically changes its cash flow and potential profitability. Enbrel sales should eclipse those of all other Immunex drugs by 2001, says Mr Debler, who feels the drug will be a $300 million product by 2001.