Immunex has need, Genentech has space to produce Enbrel

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Immunex has turned to Genentech, one of the world's few experienced biotech manufacturers, to help solve the Enbrel shortage.

Yesterday, Immunex said it inked a deal with the South San Francisco company to make Enbrel, the hit rheumatoid-arthritis drug, in 2004 and 2005, with an option for an additional year.

Enbrel sales 2005: $4 billion (Immunex goal) 2002: $1 billion (estimated) 2001: $762 million 2000: $652 million 1999: $367 million 1998: $12.7 million Source: Company reports

Spokeswoman Robin Shapiro said the arrangement will enable Immunex to make $600 million to $900 million worth of Enbrel each year, enough to serve 50,000 to 75,000 more patients.

The deal also means Immunex plans to have five Enbrel factories running by the end of 2005. Now, Immunex relies on a single factory in Germany that has been unable to keep up with demand. Some analysts say that shortfall has caused the Seattle biotech company to miss out on hundreds of millions in sales.

Terms of the deal with Genentech were not disclosed.

Genentech spokeswoman Sabrina Johnson said factory space is being freed up because production of Rituxan, a drug for non-Hodgkin's lymphoma, is being moved to a newer factory in Vacaville, Calif.

A worldwide shortage in biotech-manufacturing space means Immunex has nowhere to turn for a quick fix to its Enbrel shortage.

Analysts and investors were less than thrilled by the announcement. Immunex stock closed down 26 cents yesterday to $28.92.

"This is a ways down the road," said Andrew Heyward, a biotech analyst with Ragen MacKenzie. "It won't have any immediate effect."

Immunex is hoping it can solve the long-term shortage. Besides the Genentech deal, it is spending $1 billion to open one factory in Rhode Island later this year and another by 2005. A partner, Wyeth, is spending $1 billion on a factory in Ireland to open in 2005.

The factories are expected to produce more Enbrel in case it is approved for treatment of other diseases.

Immunex is making Enbrel at its first Rhode Island plant, but it can't sell the drug until the U.S. Food and Drug Administration approves the factory process. The company is stashing away the Enbrel — $80 million to $120 million worth — to sell once approval comes, likely later this year.

Once running at full speed, the Rhode Island factory is expected to double Immunex's current capacity and enable the company to sell $1 billion in Enbrel this year.

Immunex says about 85,000 patients take Enbrel for rheumatoid arthritis and psoriatic arthritis. About 13,000 patients are on waiting lists for the drug.

Enbrel is a genetically engineered protein that soaks up and neutralizes proteins in the body that cause inflammation.

Luke Timmerman can be reached at 206-515-5644 or ltimmerman@seattletimes.com.