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IMMUNEX SUES HOECHST FOR BREACH OF CONTRACT, BUSINESS INTERFERENCE, UNFAIR COMPETITION; PROJECTS QUARTER LOSS DUE TO REDUCED GM-CSF SALES

IMMUNEX SUES HOECHST FOR BREACH OF CONTRACT, BUSINESS INTERFERENCE, UNFAIR COMPETITION; PROJECTS QUARTER LOSS DUE TO REDUCED GM-CSF SALES
 SEATTLE, April 2 /PRNewswire/ -- Immunex Corp. (NASDAQ: IMNX) announced today that it is filing suit against Hoechst AG and its subsidiaries Behringwerke AG and Hoechst Roussel Pharmaceuticals Inc. (HRPI) for breach of contract, business interference and unfair competition in the marketing of GM-CSF (Sargramostim). Immunex and Behringwerke collaborated in the development of GM-CSF under a 1985 scientific collaboration and product license agreement. In 1989, Behringwerke assigned rights to market GM-CSF to its U.S. affiliate, HRPI. Immunex manufactures GM-CSF for Hoechst and also markets GM-CSF under the trade name LEUKINE(R).
 The suit, which will be filed today in Superior Court of the State of Washington for King County, asserts that the Hoechst subsidiaries acted to injure Immunex by shipping large supplies of Hoechst GM-CSF as free samples to Immunex's hospital customers. Immunex alleges that Hoechst violated its agreements with Immunex by failing to market GM-CSF as required by contract, failing to pay royalties to Immunex, and interfering with Immunex GM-CSF customer contracts. Immunex also alleges that the HRPI giveaway program violated the federal Prescription Drug Marketing Act, which prohibits firms from giving away drugs as free samples without appropriate safeguards.
 "We believe the Hoechst giveaways violate not only the explicit terms of our agreements, but also the implicit obligation of good faith and fair dealing that underlies every business contract," said Stephen A. Duzan, chairman and chief executive officer of Immunex. "We have now determined that these practices warrant legal action. We regret the necessity of taking this dispute to court but have no alternative since Hoechst has repudiated the most fundamental terms of its license.
 "We intend to prove that Hoechst has flooded Immunex's customer base with free GM-CSF in a deliberate attempt to undermine Immunex's investment in GM-CSF and intimidate Immunex in contract negotiations with Hoechst. Obviously, Immunex cannot afford to compete below cost with a giant firm like Hoechst. We have confirmed giveaways of approximately 10,000 vials of product and believe that is not the full extent of the giveaway program.
 "As a result, our GM-CSF sales for the first quarter have come in well below our expectations. Although high wholesale inventories and seasonal drop in demand for oncology products may have had some impact on sales, we believe the Hoechst giveaway program has seriously undercut demand for our product. As a result, we expect to report a loss for the quarter, although it will be significantly less than our loss for the first quarter in 1991 when Immunex lost $4.2 million. Immunex's financial results for the balance of 1992 will depend in part upon Hoechst's response, which we cannot now predict. However, if the effect of the giveaway program cannot be reversed, we have reason to believe that our previous expectations for the year will not be met.
 "Although our near-term financial performance will be affected by lower than expected sales, Immunex fully intends and has sufficient cash reserves to support our operations and the continued rapid development of our product pipeline. First-quarter sales of other Immunex oncology products licensed from Bristol-Myers Squibb in January were strong and building according to plan. Sales of these products will help support significant increases in research and development spending this year on three new Immunex products with significant therapeutic potential, PIXY321, Interleukin-1 receptor and TNF receptor. As of Dec. 31, 1991, Immunex had $145 million in cash and marketable securities. We will use funds from this reserve to the extent necessary to support the development of these products.
 "This suit will not significantly affect our development program for GM-CSF or alter our plans to seek a broader label for this product this year," Duzan added.
 In 1991, the U.S. Food and Drug Administration approved the use of Sargramostim for the acceleration of marrow engraftment following autologous bone marrow transplantation to treat certain cancers, and to extend survival of patients whose bone marrow transplants have failed. Immunex holds U.S. establishment and product licenses to manufacture and market the drug.
 In 1989, Immunex reacquired the right to co-market GM-CSF in the United States from Behringwerke, to which Immunex previously had licensed worldwide rights to the drug.
 Immunex Corp. is a biopharmaceutical company focused on the research, development, manufacture and marketing of products to treat cancer and autoimmune disease. Immunex is developing an extensive portfolio of therapeutic products which have the potential to treat a wide range of immune system disorders.
 -0- 4/2/92
 /CONTACT: Jason Rubin or Valoree Dowell of Immunex, 206-587-0430/
 (IMNX) CO: Immunex Corp.; Hoechst AG ST: Washington IN: MTC SU:


SC -- SE001 -- 4198 04/02/92 08:32 EST
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Date:Apr 2, 1992
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