Shares in Summit plc gained 26 percent Tuesday on news of a collaboration agreement on the company's Seglin technology with Bristol-Myers Squibb Co. (BMS) that could be worth as much as $300 million in research, development and regulatory milestones.

BMS, of New York, is deploying Summit's Seglin iminosugar drug discovery approach to 10 proprietary carbohydrate targets, which it has not disclosed.

"We understand it will be across multiple therapeutic areas," Richard Pye, head of investor relations and corporate communications at Oxford, UK-based Summit, told BioWorld Today.

"BMS will do the discovery work – they are responsible for all of that," he said. Each program will have $30 million worth of milestones attached. Summit also is receiving a $100,000 technology access fee.

It's a first deal for the company's Seglin platform, and it offers a lifeline to a technology that it is otherwise unable to support. The company's newly disclosed strategy, which it unveiled last week, emphasizes its lead programs, SMT 1100 and SMT 19969, which are in development for Duchenne's muscular dystrophy (DMD) and for Clostridium difficile infection, respectively. Neither is based on the Seglin technology.

The term Seglin is derived from "second-generation leads from iminosugars." It describes a set of orally available carbohydrate mimics that can access drug targets that are closed to conventional small-molecule discovery approaches.

Iminosugars have been available for decades, but their development as drugs has been hampered by problems with poor potency, low selectivity and a lack of diversity. By introducing greater structural diversity, Summit claimed to have overcome those obstacles. "You're able to do conventional medicinal chemistry on them as well," Pye said.

However, it is opening talks with employees as it plans to curtail internal, discovery-stage research, an activity that accounts for about half of its work force, and to focus on its clinical development programs. It also will continue to work on its lead Seglin program on the inhibition of OGA (O-linked N-acetylglucosaminidase) in tauopathies. The company expects to obtain preclinical proof of concept next year, Pye said.

SMT C1100, meanwhile, is undergoing a Phase I trial in healthy volunteers, which is due to report data before year-end. The drug, which has been reformulated to improve uptake, acts by up-regulating expression of the gene encoding utrophin, a protein involved in fetal muscle development.

Experiments with mouse models have demonstrated that it can substitute for the dystrophin, the protein that is deficient in boys who develop DMD. Although lagging other genetic approaches, such as RNA-based exon-skipping drugs, SMT C1100 could potentially address the entire patient population rather than a subset carrying a particular genetic mutation.

SMT 19969 is a narrow-spectrum antibiotic that appears to offer superior potency against existing standard-of-care drugs, such as vancomycin. It is due to enter the clinic before the end of 2012, and headline data are due next year.

Shares of Summit (LSE:SUMM) closed Tuesday at £3.15 (US$5.06), a gain of 65 pence.

The company reported £4.75 million in cash as of July 31.