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New partnership: Organon, Lexicon spell out biologics collaboration
July 2005
by Lisa Espenschade  | 
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THE WOODLANDS, Texas–Lexicon Genetics Inc. and Organon announced in late May a long-term multiphase collaboration that leverages their complementary capabilities to discover, develop, and manufacture novel biotherapeutics. The companies will divide evenly eventual product revenues.
 
The program's ultimate goal, says Brian P. Zambrowicz, Lexicon's executive vice president of research, is "to identify at least five development candidates — and that would be five antibodies or secreted proteins — that show some proof of principle effect in an animal." Immunology, inflammation, and cancer are likely therapeutic areas, and two validated target diseases are asthma and breast cancer.
 
The first phase has begun, Zambrowicz says, with the companies "already looking at the function of some of the 300 genes that have been chosen" for study. The initial stage will last about four years, but Zambrowicz says the program is staggered, so "there will be an overlapping phase of drug development, and that drug development phase will obviously last longer." David Nicholson, Organon's executive vice president, global research, says, "the full R&D trajectory for each project that emerges from this program will take some 10 years," and the collaboration "will continue until the final project is finalized."
 
The program builds on a Lexicon-Organon alliance that began in 1998 with target validation work, says Zambrowicz, noting that the existing relationship "made things easier and friendly in getting the process going." The companies, he says, chose "those 300 genes from things that we hadn't completed the functional analysis on. The decision was to share the risk in the discovery all the way through the development process." Lexicon's Genome5000 program, which uses knockout technology to analyze gene function and define "druggable" genes in mouse models, underlies the new project's initial phase.
 
Further research, development, preclinical and clinical studies, as well as commercialization activities, will be shared, according to Nicholson. Organon will lead production because its "capability in protein production is significant," says Zambrowicz.
 
Financial arrangements include Organon's $22.5 million upfront payment for access to Lexicon's target discovery capabilities and the right to jointly develop biotherapeutics products. Annual research payments, of up to $50 million, will fund Organon's share of discovery costs. Sharing all costs evenly results in even ownership of products, says Nicholson, though "either party can opt out of the cost/profit sharing arrangement for a collaboration product in favor of a royalty structure."
 
Zambrowicz says Lexicon looks forward to learning from Organon's "experience in all aspects of drug development" and benefiting from its "significant marketing capacity" that sells products in 100 countries.
Beyond providing a new generation of drugs for Organon, Nicholson sees the Lexicon alliance, "combined with the opening of Organon's Research Center in Cambridge, Mass., [as reinforcing] Organon's commitment to R&D and partnerships in biotechnology to build new franchises in areas such as immunology." The Cambridge, Mass. center is Organon's first research site in the U.S. and will employ 30 scientists.
 
Code: E070521

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