Staff Writer

In its first license agreement for small-molecule compounds, Emisphere Technologies Inc. signed on with F. Hoffmann-La Roche Ltd. to develop oral formulations of approved therapies for bone-related diseases.

Tarrytown, N.Y.-based Emisphere could receive up to $18.5 million in milestone payments for each compound developed.

The company typically has focused on the area of peptides and proteins, but now it is demonstrating that its eligen delivery technology can be applied to the whole new field of small molecules. Roche, of Basel, Switzerland, and Emisphere have a short history together, and the deal represents their first major agreement.

"It's obviously a new company we have never announced working with before," said Lew Bender, Emisphere's senior vice president for business development. "It's a premium company and that gives us another significant player in the industry that values our technology."

Roche will pay Emisphere an up-front fee of "more than $1 million," said Elliot Maza, Emisphere's chief financial officer. The exact amount will be disclosed in the company's year-end results. In addition, Emisphere could receive the aforementioned $18.5 million in milestone payments for each product developed using the eligen technology. There is no limit on the number of products that could be developed, Maza said.

Emisphere also is entitled to undisclosed royalties if products reach the market.

"Sales for products of this class of drugs are expected to reach $5 billion in 2004," Bender told BioWorld Today.

Roche will fund the necessary preclinical, clinical and manufacturing costs for all products. Emisphere has no further financial obligations with the products. It is unclear as to when any of the oral formulations might reach the market.

"There is a development plan in place, but we need to have discussions with regulatory authorities to determine how long that's going to be," Bender said.

The initial compound to be developed already has gone through preclinical and human feasibility studies. It is the seventh compound successfully delivered in humans with the eligen technology.

The partnership with Roche is Emisphere's second deal announced in the last two months. In September, the company entered a licensing agreement worth up to $34 million with Novartis Pharma AG, of Basel, Switzerland, to develop an oral formulation of recombinant human growth hormone. (See BioWorld Today, Sept. 24, 2004.)

The eligen technology is based on the use of synthetic chemical compounds, known as Emisphere delivery agents, or "carriers." Those molecules help transport the therapeutic macromolecules across biological membranes, such as those of the gastrointestinal tract, and exert the desired pharmacological effect. The eligen technology allows for the oral delivery of a therapeutic molecule without altering its chemical form or biological integrity.

Emisphere focuses on the oral delivery of otherwise injectable drugs. It works both on programs in-house and with corporate partners, licensing its eligen technology for use with marketed products. The company and its partners have advanced into clinical trials oral formulations of prototypes that include calcitonin, heparin, insulin, parathyroid hormone and human growth hormone.

"We have a strategy of working to license our technology to others, while pursuing our own programs in heparin and insulin," Maza said.

Data reported earlier this month at the American Association of Pharmaceutical Scientists meeting in Baltimore showed that hyperglycemia, polydipsia, weight loss and autonomic dysfunction could be reversed with insulin using Emisphere's eligen technology. Separate results showed that a solid formulation of insulin using eligen significantly increased insulin levels and prolonged blood glucose lowering.

Emisphere's stock (NASDAQ:EMIS) rose 15 cents on Thursday to close at $3.13.