US biotechnology firms Facet Biotech Corporation (Facet) and Trubion Pharmaceuticals Inc (Trubion) entered into an agreement on Friday for the joint worldwide development and commercialisation of TRU-016, a drug for blood cancer.

The drug is a first-in-class B-cell (white blood cell that play a larger role in the human immune system) directed therapy for patients with B-cell malignancies, and patients with autoimmune and inflammatory diseases like leukemia. The drug is in phase 1 clinical development for chronic lymphocytic leukemia (CLL).

Under the collaboration agreement, Facet will pay up to $176.5 million to Trubion based on certain development, regulatory and sales milestones apart from an upfront payment of $20 million.

Both the companies agreed to share equally the costs of all development, commercialisation and promotional activities and all global operating profits. Facet will also purchase approximately 2.24 million newly issued shares of Trubion for $10 million. 

Facet president and CEO, Faheem Hasnain said, "TRU-016 is a promising therapeutic with impressive preclinical and preliminary clinical data for CLL that will greatly enhance our pipeline and support a key strategic objective, which is to build a robust oncology portfolio."

Seattle-based Trubion is a biopharmaceutical development-stage company that is creating a pipeline of novel protein therapeutic products to treat autoimmune and inflammatory diseases and cancer.

Trubion CEO and chairman, Peter Thompson said: "We are delighted to have Facet as our partner. Coupled with our own strengths in the discovery and development of novel protein therapeutics, their expertise will afford us the opportunity to pursue the clinical development and commercialization of TRU-016 and other CD37-directed therapeutics in the most aggressive manner possible."

Trubion believes that TRU-016's novel design may provide patients with improved therapeutic options and enhance efficacy when used alone or in combination with chemotherapy.

Trubion's other products include TRU-015  and SBI-087 for the treatment of rheumatoid arthritis. Last year, the company entered into an alliance with pharma major Wyeth, for the development and commercialization of therapies utilisng Trubion's Small Modular Immunopharmaceutical (SMIP) therapeutics. 

Wyeth is being acquired by Pfizer, the world's biggest pharmaceutical company and last month, the European Union approved the deal.

California-based Facet is a biotechnology company dedicated to advancing its four clinical-stage products, identification and development of new oncology drugs and improvement in the clinical performance of protein therapeutics. The company was launched in 2008 as a spin-off from PDL BioPharma Inc.

Facet's products include Daclizumab for multiple sclerosis and Volociximab for solid tumors (phase 2 clinical) Elotuzumab for multiple myeloma and PDL192 for solid tumors (phase 1 clinical), and PDL241 for immunological diseases (pre-clinical stage).

Further to the news, Trubion shares surged a whopping 76 per cent to $6.75, before settling at $5.55, 45 per cent higher, Friday on Nasdaq while Facet ended 0.92 per cent lower at $10.37.