By Lisa Seachrist

Washington Editor

Vaccine specialist Corixa Corp. and QLT Therapeutics Inc. will combine their expertise in a collaboration to expand the use of photodynamic therapy into new disease areas.

The agreement is a two-stage deal in which QLT has agreed to pay an up-front licensing fee for the exclusive right to develop certain immunotherapeutic compounds for certain diseases. QLT will evaluate whether the Corixa compounds in combination with its photodynamic therapy (PDT) prove useful in the treatment of diseases not ordinarily susceptible to PDT. If the collaboration proves successful, it will be expanded and call for the generation of additional product candidates by Corixa in exchange for additional licensing fees and royalties. QLT would also purchase a small amount of equity in Corixa at a premium.

The companies aren't disclosing further terms and conditions of the agreement.

"This is all very early stage and conceptual in nature," said Ken Galbraith, Vancouver, British Columbia-based QLT's senior vice president and CFO. "We are looking into getting into certain disease targets that weren't good candidates for PDT alone. We are trying to see if we can expand the use of PDT by combining it with other technologies."

The compounds Corixa is providing to the collaboration represent technology the Seattle-based company obtained with its purchase of Ribi ImmunoChem Research Inc. in June. Ribi's technology included a number of adjuvant technologies. (See BioWorld Today, June 11, 1999, p. 1.)

"From our perspective there was some technology at Ribi of value that wasn't being exploited," said Steven Gillis, chairman and CEO for Corixa. "This is the first of what we hope will be several examples of converting that technology into real economic value. I think it's a nice transaction for both companies."

Because the collaboration could ultimately take any number of forms, Gillis said it would be difficult to describe the terms of the agreement, even if the two companies had agreed to such disclosure. Both Gills and Galbraith said the terms would be better characterized as the collaboration evolved.

QLT's lead therapy is Visudyne, a light-activated therapy for the treatment of "wet-form" age-related macular degeneration. The company received an approvable letter for the therapy in February and is awaiting final approval. The company's marketing and development partner, Atlanta-based CIBA Vision Corp., the eye-care unit of Novartis AG, has pledged to start marketing the therapy within a week of final approval.

"We are very optimistic about launching Visudyne [early in the second quarter]," Galbraith said. "We've always been a little conservative in our estimates so that may explain the market volatility while we wait for final approval."

QLT's stock (NASDAQ:QLTI) closed Friday at $65, down $4.875. Corixa's stock (NASDAQ:CRXA) closed at $59.125, down $3.625.

Corixa is preparing to meet with the FDA to determine whether it has the clinical data needed to file a biologics license application for Melacine, a melanoma vaccine. Gillis said if all goes smoothly he would expect to file the BLA by the end of this year.