J&J ends flu-drug deal with BioCryst

Two Johnson & Johnson companies, Ortho-McNeil Pharmaceuticals and the RWJohnson Pharmaceutical Research Institute, have given four months prior notice that they intend to end their partnership with BioCryst Pharmaceuticals, signed nearly three years ago (Marketletter September 21, 1998), to develop and sell products that treat and prevent influenza. The lead drug in this program, RWJ-270201, is currently in Phase III trials in Europe and acts by interfering with the neuraminidase enzyme, the same target as GlaxoSmithKline's Relenza (zanamivir) and Gilead/Roche's Tamiflu (oseltamivir), which are already on the market.

J&J is required to continue with the research for another four months but after that will return all rights to the experimental treatment to BioCryst, as well as the rights to other neuraminidase inhibitors discovered by the latter company. BioCryst's chief executive, Charles Bugg, said: "we are disappointed with the decision of Ortho-McNeil," but added that the firm will continue with Phase III trials of RWJ-270201 and seek a new corporate partner to help develop and market it. Following this announcement, on April 30, BioCryst' shares tumbled 29% to $4.80.