RATIONALE: Biological therapies use different ways to stimulate the immune system and stop cancer cells from growing. Combining different types of biological therapies may kill more cancer cells.

PURPOSE: Phase II trial to study the effectiveness of biological therapy in treating patients who have myelodysplastic syndrome.

OBJECTIVES:

• Determine the frequency of hematologic responses in patients with myelodysplastic syndrome treated with anti-thymocyte globulin and tumor necrosis factor receptor IgG chimera.
• Correlate phenotypic, cytogenetic, and functional disease characteristics with treatment responses in these patients.
• Determine the safety of this treatment regimen in this patient population.

OUTLINE: Patients receive anti-thymocyte globulin IV over 8 hours daily for 4 days followed by tumor necrosis factor receptor IgG chimera subcutaneously twice weekly for 16 weeks.

Patients are followed at 8, 16, and 20 weeks.

PROJECTED ACCRUAL: A total of 15 patients will be accrued for this study.

• Leukemia
• Myelodysplastic Syndromes

• Biological: anti-thymocyte globulin
• Biological: etanercept

DISEASE CHARACTERISTICS:

• Diagnosis of myelodysplastic syndrome with no greater than 20% marrow blasts with:

  • Single or multilineage cytopenia (neutrophils less than 2,000/mm^3 and/or platelet count less than 100,000/mm^3 and/or reticulocyte count less than 18,000/mm^3) OR

  • Transfusion requirement of at least 2 units packed red blood cells per month and one of the following:

    • Suitable marrow donor unavailable
    • Ineligible for a transplantation protocol
    • Unwilling to proceed with transplantation
• No chronic myelomonocytic leukemia

PATIENT CHARACTERISTICS:

Age:

• Any age

Performance status:

• Not specified

Life expectancy:

• Not specified

Hematopoietic:

• See Disease Characteristics

Hepatic:

• Not specified

Renal:

• Not specified

Other:

• No other severe disease that would preclude study
• No active severe infection (e.g., pneumonia or septicemia) or severe infections within the past 2 weeks

PRIOR CONCURRENT THERAPY:

Biologic therapy:

• See Disease Characteristics
• At least 4 weeks since prior hematopoietic growth factors
• No concurrent hematopoietic growth factors

Chemotherapy:

• At least 4 weeks since prior cytotoxic therapy
• No concurrent cytotoxic therapy

Endocrine therapy:

• Not specified

Radiation therapy:

• Not specified

Surgery:

• Not specified

Other:

• At least 4 weeks since prior immunomodulatory therapy
• No concurrent immunomodulatory therapy