Schering-Plough teams with J&J to develop arthritis drug

Schering-Plough is planning to help rival Johnson & Johnson develop an experimental drug for rheumatoid arthritis but the two companies continue to disagree on the length of their contract together to do so, according to a Reuters report.
Schering-Plough said it is entitled to co-develop and co-market the experimental drug under a 1998 agreement with J&J's biotech division Centocor, which also gave Schering-Plough the rights to sell Centocor's older drug Remicade for rheumatoid arthritis outside the U.S. Remicade has become one of Schering-Plough's best-selling products, with second-quarter sales jumping almost 30 percent to $234 million.
Schering-Plough said it will take a third quarter charge of $125 million to reimburse J&J for research expenses already incurred for the new experimental treatment, called CNTO148. Like Remicade, the new drug works through blocking an inflammation –causing protein called tumor necrosis factor.
Schering-Plough and J&J will share future development and marketing expenses related to the compound, which is expected to enter Phase III clinical trials in early 2006.
As in the Remicade agreement, Schering-Plough would have rights to sell the drug outside the U.S., while J&J would keep for itself the U.S. market.
Although both drug makers are pooling efforts and money behind CNTO 148, they disagree on how long Schering-Plough will be entitled to sell the new medicine, if it is approved.
J&J believes marketing rights expire in 2014, while Schering-Plough believes they do not expire until later, Schering-Plough told Reuters.

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