Interesting story (not about Procept):
Baxter Beat CellPro in Court,
But Some Say Dying Patients Lost
By BILL RICHARDS
Staff Reporter of THE WALL STREET JOURNAL
PHILADELPHIA -- After four failed bone-marrow transplants, Stephen
Grupp's patient, an eight-year-old girl with advanced leukemia, died in
January.
Dr. Grupp looks frustrated as he describes the harrowing struggle. "In the
end," says the pediatric oncologist at Children's Hospital here, "we just ran
out of options."
There is one option Dr. Grupp didn't get to try: an experimental procedure
that is aimed at some of the deadliest of all cancers. It is so new that
researchers are still trying to figure out if it works. Yet in patient trials early
last year on 15 children with advanced leukemia -- all of whom were
regarded as terminal -- a third using the treatment survived bone-marrow
transplants, with no sign of cancer afterward. A larger set of trials was to
begin last November on 50 children with advanced leukemia and two
groups of adults with a virulent cancer known as B-cell non-Hodgkin's
lymphoma, which killed Jordan's King Hussein in February.
The expanded trials, Dr. Grupp says, "were exactly what I was looking
for."
Trials and Tribulations
The trials never took place. Their sponsor, a small biotechnology company
called CellPro Inc., canceled them last September after losing a long and
bitter patent fight to Baxter International Inc., the global medical-products
company. The companies had been developing competing systems for the
experimental procedure. At the time, CellPro's system, called Ceprate,
was farther down the regulatory road toward federal approval for sale and
use in the U.S. CellPro officials say their five-year legal battle with their
much larger corporate rival exhausted CellPro's finances, forcing it to seek
Chapter 11 bankruptcy-court protection and cancel the trials.
CellPro's fate and the abrupt cancellation of the Ceprate trials have
triggered an unusual outpouring of anger from many cancer researchers.
While promising medical technology often falters on scientific shortcomings
or marketing miscues, the researchers blame the loss of CellPro's scientific
work on a clash of corporate egos and a single-minded pursuit of
commercial advantage by both companies.
As a result, they say, hundreds of otherwise-doomed cancer patients have
lost a shot at a last-ditch experimental treatment that might offer a ray of
hope, even as the companies persist in bitter finger-pointing. Now the
National Institutes of Health, the federal government's top medical
research body, is looking into what tripped up the trials and whether any
patients have been harmed.
CellPro and Baxter are now out of the very business they've been fighting
over for years. CellPro exists mainly on paper. Baxter has sold the
operations that were developing its rival system, known as Isolex. They
are now owned by Nexell Therapeutics Inc. Baxter holds a 40% stake in
Nexell. On July 2, the Food and Drug Administration gave Nexell
approval to market Isolex in the U.S. for the most common but less
dangerous type of bone-marrow transplant. Nexell says it expects to begin
marketing Isolex within the next few months.
Chaos Theory
Nonetheless, many researchers say the long feud between CellPro and
Baxter has thrown the field of bone-marrow transplant research into
chaos. Hillard Lazarus, a cancer specialist at Cleveland's Case Western
Medical Center, says his institution, like several others, has turned away
some dying patients who would have qualified for CellPro's trials. "We're
fighting a battle with one arm behind our back," he says.
Richard Burt, a bone-marrow transplant expert at Northwestern University
Medical Center in Chicago, says CellPro's trials were "years" ahead of
Baxter's program. Donna Wall, an oncologist at Cardinal Glennon
Children's Hospital in St. Louis, says the CellPro trials were "an option
when there was no other option." She had two children set for the trials
when they were dropped. One has died, she says.
The procedure at issue is known as cell selection and lymphocyte
depletion, and it targets a critical shortcoming of bone-marrow transplants.
Transplant patients are bombarded with radiation and chemotherapy to
attack cancer cells in their bone marrow, where leukemia and related
cancers take root. But the process also wipes out a patient's vital stem
cells, which produce the blood and immune-system cells needed for
survival. So some stem cells are taken from the marrow donor -- or from
the patient, if the patient is the source of the marrow -- before the
procedure, and reinfused after the chemotherapy and radiation.
The problem is that stray cancer cells or powerful immune-system cells
called lymphocytes can lurk in the reinfused stem cells, reigniting the cancer
or triggering transplant rejection. CellPro's Ceprate system, the
centerpiece of which is a tall column containing genetically engineered,
pebble-like beads through which blood is dribbled, is designed to first
"select" and concentrate stem cells, then strip out, or "deplete," tumor and
lymphocyte cells.
Ceprate received FDA clearance almost three years ago for sale in the
U.S. for the first stage of the process; the trials were aimed at gaining
approval for the depletion phase. The FDA's approval for Isolex last
month applies only to transplants in which the patient is the marrow donor.
Nexell says it expects to receive broader approval for transplants involving
marrow donated by someone other than the patient -- the riskiest type of
bone-marrow transplant and the kind that some of the Ceprate trial
patients would have undergone -- in 2001.
CellPro and Baxter first locked horns in November 1993, when Baxter
sued alleging patent infringement. In 1995, a jury in U.S. District Court in
Delaware found in CellPro's favor. But a year later, the judge in the case
overturned the verdict and ruled from the bench that CellPro had infringed
Baxter's patent. CellPro was barred from selling its system -- its only
product -- in the U.S. After losing its appeals, CellPro filed for bankruptcy
protection in October 1998.
Executives of both companies acknowledge that their squabble has cost
some researchers a shot at trying CellPro's system on seriously ill patients.
But each company blames the other. "This was a train wreck that didn't
have to happen," says Victor Schmitt, who heads Baxter's
venture-management group.
Mr. Schmitt says that instead of carrying through on plans to mount the
expanded round of Ceprate trials last fall, CellPro hoarded its remaining
cash reserves -- about $8 million -- so managers and directors could
defend themselves against shareholder lawsuits triggered by CellPro's
reversals in court.
Baxter officials also say they tried several times to purchase the smaller
company and its technology, or to license the disputed patent to it, but
were rebuffed. In late 1997, for example, Mr. Schmitt says Baxter offered
to buy CellPro for Baxter stock worth "considerably more" than CellPro's
$10 million Nasdaq market value at the time. "Was it the deal CellPro
wanted?" says Mr. Schmitt. "Probably not, but it made sense. I guess they
thought they'd still win."
When CellPro lost its final appeal last August, Baxter announced it was
buying 800 of CellPro's Ceprate kits and would make them available at
cost to researchers while the FDA decided whether to approve Isolex.
"We wanted to insure continuous access for patients to the technology,"
Mr. Schmitt says. The trials' collapse "wasn't because some big bad
multinational pushed someone around. If patients are in jeopardy, then
[CellPro] put them in jeopardy."
CellPro officials say Baxter is to blame. Rick Murdock, CellPro's former
chief executive officer, says Baxter officials decided early in the patent fight
to eliminate CellPro and Ceprate to clear away competition to the Isolex
system. Mr. Murdock is Ceprate's poster boy. Three years ago, after he
developed a virulent form of cancer and needed a bone-marrow
transplant, CellPro accelerated development of the technology. At the
time, the combined selection and depletion treatment had never been
tested on humans. Mr. Murdock, whose prognosis was down to months,
served as a guinea pig; he recovered, and his doctors say he remains
cancer-free.
Mr. Murdock says CellPro rejected Baxter buyout offers during the patent
battle because he believed CellPro would eventually win the patent fight on
appeal and would be worth far more than Baxter was offering. When it
lost its appeals, it offered to sell the entire company, including the planned
trials, to Baxter for less than $10 million.
Nexell countered by offering stock worth about $3 million, but just for
some CellPro research data. The deal wouldn't have kept CellPro's
research and production going. Still, Baxter said it would work with
CellPro "to define a program to manage ongoing clinical trials with respect
to the Ceprate system." CellPro accepted that offer, but without
researchers to go with the data, CellPro officials say the trials were
doomed.
CellPro officials also dispute Baxter's assertion that CellPro hoarded cash
to fend off investor lawsuits. It was Baxter, CellPro says, that claimed the
$8 million remaining in CellPro's treasury as the patent fight ground down.
Baxter secured a court order requiring CellPro to pay Baxter's legal fees
-- about $8 million. That order, says Mark Handfelt, CellPro's general
counsel, meant that there would be no money left over for the cancer trials,
which can cost as much as $100,000 a day.
As proof, CellPro officials offer internal budget documents that show that
shortly after the Chapter 11 filing last September, CellPro listed Baxter as
its largest creditor. The records show a disbursement of $8 million
scheduled for "Baxter Legal Fees" and another $2.5 million to "Settle
Shareholder Suits." Mr. Handfelt says CellPro paid Baxter the $8 million
but settled the shareholder suits without paying cash.
Moreover, Baxter's offer to supply researchers with Ceprate kits was also
misleading, says Amy Sing, CellPro's former medical director. The 800
kits Baxter agreed to acquire were only for the stem-cell separation stage
of the process, she says. The second-stage cell-depletion technology Dr.
Grupp and others would have used in the trials wasn't part of the deal, she
says.
Dr. Sing and some other researchers estimate that as many as 300 terminal
cancer patients have lost access to Ceprate since the trials were canceled.
"There's no logical explanation for what Baxter did," she says.
Meanwhile, federal health officials say they, too, are concerned about the
cancellation of the Ceprate trials. During the patent fight, CellPro made a
novel petition to the National Institutes of Health, asking it to assign the
disputed patent to CellPro under a never-used provision of federal law.
The provision empowers the NIH to assign patents that have been
developed with federal money -- as the disputed patent was -- to any
company it chooses if it determines the patents aren't being used for the
public good. CellPro argued that patients would lose access to the
treatment if it lost the patent case.
Baxter countered by pledging to the NIH that it would maintain patient
access to CellPro's technology even if CellPro didn't survive. In a letter to
Health and Human Services Secretary Donna Shalala, Vernon Loucks,
then Baxter's chairman and chief executive officer, promised in June 1997
that there would be "no gap" in access to "this important technology" and
predicted that Baxter's Isolex would be approved by the FDA by the end
of 1997.
The NIH denied CellPro's petition in August 1997, citing Baxter's pledge
and the imminent approval of Isolex. Two months later, Baxter announced
it was selling its cell-technology unit to Nexell.
NIH officials say they're troubled by the turn of events. Barbara McGarey,
senior counsel for the NIH's Office of Technology Transfer, is surprised to
learn of the collapse of CellPro's trials. At the time of the NIH's decision
on the CellPro petition, the agency believed the trials would continue,
whether or not CellPro survived, she says. The NIH "didn't want to jump
between two corporations that were fighting," Ms. McGarey says. "It
certainly wasn't our intention to have patients denied access to this
technology." She says the NIH wants to know whether it was misled
during the patent fight, and whether patients were harmed.
Mr. Loucks, now retired from Baxter, declines to comment. William
McIntosh, Nexell president and CEO, says that when Isolex is
commercially available, it will outperform CellPro's Ceprate system, and
Isolex does have fans. A senior researcher at Seattle's Fred Hutchinson
bone-marrow transplant center in Seattle, for example, says the technology
in some ways may prove superior to Ceprate. But several other specialists,
including some cited by Nexell as experts on Isolex, say it doesn't perform
as effectively as Ceprate in purging hidden tumor and immune-system cells
from stem cells, critical for surviving transplants.
Isolex's shortcoming may "be fixed in a year or two," says Dr. Grupp of
Philadelphia's Children's Hospital, "but it definitely isn't now." Case
Western's Dr. Lazarus, who has tried both systems, calls Isolex "an inferior
technology."
Nonetheless, he says Case Western researchers are switching to Isolex,
because that is all that is available. And he decries the corporate warfare
that led to the end of CellPro's trials.
"The operable word here is avarice," Dr. Lazarus says. "What did these
companies accomplish? CellPro is essentially dead. We lost a souped-up
race car and now we're left with a horse and buggy." |
