Cellmid close to royalties on cancer test licences

Cellmid (ASX:CDY) is edging closer to milestone payments and royalties from both of its cancer diagnostics technology licensees.

The company announced that Quest Diagnostics subsidiary Celera is preparing to conduct clinical evaluation of its lung cancer test, developed using Cellmid’s midkine diagnostics technology.

Samples from the National Cancer Institute’s chest X-ray screening Prostate, Lung, Colorectal and Ovarian (PLCO) trial will be used to validate the clinical accuracy of the test.

Celera also recently transferred the test from ELISA onto the Luminex platform widely used by pathology labs.

Cellmid licensed the use of midkine as a biomarker for the diagnosis of lung cancer to Celera in late 2009. Celera was subsequently acquired by Quest in 2011.

Under the terms of the licensing agreement, Cellmid will be entitled to a milestone payment once the diagnostics test is cleared by regulators, as well as royalties to be paid semiannually.

Cellmid is also licensing midkine as a biomarker for bladder cancer diagnostics to Pacific Edge.

The company revealed that Pacific Edge has now received CLIA registration for its Pennsylvania labs from the US Centre for Medicare and Medical Devices. This certification is required for clinical laboratory testing in the US.

CLIA registration paves the way for the launch of Pacific Edge’s bladder cancer test, Cxbladder. Cellmid will receive a milestone fee payable in Pacific Edge shares upon the first sale of Cxbladder in the US, as well as semiannual royalties.

Midkine is a growth factor barely expressed in healthy adults but present in patients with various disorders including cancer. Cellmid holds multiple patents protecting its use as a cancer diagnosis biomarker and is also developing a cancer treatment based on anti-midkine antibodies.

Cellmid shares were trading unchanged at $0.04 as of around 2 pm on Tuesday.