RATIONALE: Drugs used in chemotherapy use different ways to stop tumor cells from dividing so they stop growing or die. Peripheral stem cell transplantation may allow the doctor to give higher doses of chemotherapy drugs and kill more tumor cells. Total-body irradiation and drug therapy may be used to suppress the immune system and reduce the chance of developing graft-versus-host disease following transplantation.

PURPOSE: Phase I/II trial to study the effectiveness of high-dose melphalan and autologous peripheral stem cell transplantation followed by immunosuppressive therapy and allogeneic peripheral stem cell transplantation in treating patients who have multiple myeloma.

OBJECTIVES: I. Determine engraftment of HLA identical peripheral blood stem cell allografts given after conditioning with total body irradiation and postgrafting immunosuppression with cyclosporine/mycophenolate mofetil in patients with multiple myeloma initially cytoreduced with high dose melphalan. II. Determine disease free survival of these patients at day 100 post allografting. III. Determine the efficacy of this regimen in terms of long term progression free survival of these patients.

OUTLINE: Patients receive cyclophosphamide IV over 1-2 hours on day 1, paclitaxel IV over 4 hours on day 2, and filgrastim (G-CSF) subcutaneously (SQ) beginning on day 3 and continuing until the end of leukapheresis. Autologous peripheral blood stem cells (PBSC) are collected over 3-4 days and selected for CD34+ cells. Patients receive melphalan IV on day -2 (which is at least 31 days after paclitaxel), then autologous CD34+ PBSC are reinfused on day 0. G-CSF SQ or IV is administered beginning on day 0 and continuing until blood counts recover. About 40-120 days after autografting, patients receive cyclosporine IV twice a day on days -1 and 0, then orally on days 1-56 and oral mycophenolate mofetil twice a day on days 0-27. Patients undergo total body irradiation on day 0, followed by infusion of unmodified donor PBSC. At days 28 and 56, patients are evaluated for lymphoid and myeloid chimerism. Patients with stable mixed chimerism on day 56 without graft versus host disease receive nonmobilized donor lymphocyte infusion (DLI) over 30 minutes on day 65. Patients may receive up to 4 DLI's. Patients are followed weekly until day 90 after the last T-cell infusion, then at 4 and 6 months, then every 6 months for 1.5 years, then annually thereafter.

PROJECTED ACCRUAL: A total of 40 patients will be accrued within 4 years.

• Biological: filgrastim
• Biological: peripheral blood lymphocyte therapy
• Drug: cyclophosphamide
• Drug: cyclosporine
• Drug: melphalan
• Drug: mycophenolate mofetil
• Drug: paclitaxel
• Procedure: peripheral blood stem cell transplantation
• Radiation: radiation therapy

DISEASE CHARACTERISTICS: Cytologically diagnosed multiple myeloma (MM) Stage II or III at diagnosis OR Progressive after initial diagnosis of stage I disease and received chemotherapy and/or radiotherapy Must have received at least 4 courses of conventional dose chemotherapy for MM HLA genotypically identical sibling available (not identical twin)

PATIENT CHARACTERISTICS: Age: 65 and under Performance status: Karnofsky 60-100% (unless less than 60% due solely to MM) Life expectancy: Not specified Hematopoietic: Not specified Hepatic: Bilirubin no greater than 2 times upper limit of normal (ULN) SGOT and SGPT no greater than 2 times ULN Renal: Creatinine clearance at least 40 mL/min Cardiovascular: LVEF at least 40% No poorly controlled hypertension Pulmonary: DLCO at least 50% corrected No continuous supplemental oxygen Other: Not pregnant Fertile patients must use effective contraception during and for 12 months after study HIV negative

PRIOR CONCURRENT THERAPY: Biologic therapy: No prior autograft Chemotherapy: See Disease Characteristics Endocrine therapy: Not specified Radiotherapy: See Disease Characteristics No concurrent radiotherapy with melphalan administration Surgery: Not specified