Staff Writer

Rigel Pharmaceuticals Inc. entered its first drug discovery collaboration by signing with its first Japanese partner, agreeing to collaborate with Daiichi Pharmaceuticals Co. Ltd. on protein degradation related to cancer.

It's also the first time that the South San Francisco-based company has retained any commercialization rights, said James Welch, vice president and chief financial officer at Rigel.

"First and foremost, all of our collaborations to date have been target discovery deals, whereas this is a drug discovery deal where we start with high-throughput screening" before moving into drug development, he said, adding that as the company has progressed, so have its deals.

Daiichi, of Tokyo, will give Rigel an undisclosed up-front payment, as well as research support and "standard" milestone payments for a deal of this nature, Welch said. Additionally, Rigel will receive royalties on any commercialized products, and it retained North American rights to co-develop and co-promote any resulting products with Daiichi.

The collaboration will look at protein degradation, the enzymes that target proteins and how both relate to cancer, Welch said. The company said its technology is designed to identify molecules that play key roles in regulating a cell's response to disease. Its technology tests proteins in a large number of cells to determine which proteins change a cell's response to a disease.

"The research phase will be about three years," Welch said, but added that "the duration will be dictated truly by what is discovered under this program and how it goes through" the research.

Welch added, "The initial program has been ongoing for a couple of years; this is centered on a specific oncology target coming out of the program."

Rigel said its research already uncovered "a number of compounds" that appear to inhibit replication of several types of tumor cells.

Rigel, which raised $31.5 million in January in order to enter its first compound in the clinic this year in asthma/allergy, focuses on immune diseases and cancer. (See BioWorld Today, Jan. 18, 2002.)

The company has 11 different programs under way, five of which focus on asthma/allergy, rheumatoid arthritis and inflammatory bowel disease, cancerous tumor growth and hepatitis C. Rigel has five joint programs with partners in asthma/allergy, autoimmunity, transplant rejection and three programs in cancer. The final joint program involves one partner that is conducting a program in chronic bronchitis at Rigel's facilities.

Rigel has collaborations with Pfizer Inc., of New York; Johnson & Johnson Pharmaceutical Research & Development LLC, a unit of Johnson & Johnson, of New Brunswick, N.J.; and Novartis Pharma AG, of Basel, Switzerland. In January, Rigel and Johnson & Johnson signed a two-year extension for their oncology collaboration.

Last August, Rigel and Novartis expanded their original $100 million deal, giving Rigel a $4 million up-front payment. (See BioWorld Today, Aug. 1, 2001.)

Rigel's stock (NASDAQ:RIGL) rose 30 cents Monday, or 14 percent, to close at $2.45.