Taking 12 percent ownership in the firm, Pfizer Inc. invested $50 million in personalized medicine company Perlegen Sciences Inc.

Privately held Perlegen, of Mountain View, Calif., first began working with Pfizer in December 2002 through a research collaboration. The companies used Perlegen's DNA sample preparation, high resolution single nucleotide polymorphism (SNP) genotyping and data analysis capabilities not only to discover genes associated with common diseases, but also to find genetic markers that might predict patient response to drugs.

"This investment is really just an evolution of that relationship," said Rob Middlebrook, Perlegen's chief corporate development officer.

New York-based Pfizer bought $50 million of preferred stock and has agreed to purchase an additional $25 million of stock if Perlegen conducts an initial public offering within 2006. Perlegen has raised $207 million since its 2001 inception. Its last financing, which brought in $74 million in February, was expected to last the company through early 2007. Perlegen might file for an IPO as its next financing - or it might not.

"We are always watching the capital markets, and at this point, we have not reached any definitive conclusions as to whether or when we would pursue a public offering," Middlebrook told BioWorld Today.

In addition to Pfizer, Perlegen's investors include Affymetrix Inc., of Santa Clara, Calif.; Maverick Capital, of New York; CSK Ventures, of Tokyo; Eli Lilly and Co., of Indianapolis; and several other institutional and private investors.

Founded as a spin-off from Affymetrix, Perlegen works to discover genetic variations that could help drug developers find therapies for certain populations. There are plenty of drugs that fail in late-stage trials and get tossed aside after millions of dollars spent, even though they might work well in certain patients. Perlegen works to determine which patients show the most benefit and why, potentially eliminating some of the risk involved with drug development.

"What we do is high-density whole-genome analysis," Middlebrook said. "We look at hundreds of thousands and sometimes more than a million [SNPs], and we look at them in hundreds of thousands of DNA samples."

The company's knowledge also could be used in dealing with side effects found in particular patients receiving certain therapies. One drug that theoretically could benefit from pharmacogenomics is the multiple sclerosis drug Tysabri, developed by Dublin, Ireland-based Elan Corp. plc and Cambridge, Mass.-based Biogen Idec Inc. It was approved with strong, one-year efficacy data, but was pulled a short time later when a limited number of patients exhibited a serious side effect, progressive multifocal leukoencephalopathy. (See BioWorld Today, March 1, 2005.)

In November, the FDA accepted and designated for priority review a supplemental biologics license application for Tysabri, which included final, two-year Phase III data, an integrated safety assessment and a revised label and risk management plan. Pharmacogenomics could help find which patients would best benefit from Tysabri, but Perlegen's technology probably would not help that particular drug.

"Because there have been fewer than five cases of the adverse effect of Tysabri, our technology would not be appropriate, in at least the traditional sense, to help that compound," Middlebrook said.

Perlegen's technology requires large numbers of samples in order to determine SNPs that predispose certain patients to disease. Middlebrook would not disclose what parts of Pfizer's pipeline might benefit from the technology.

"The types of drugs that we think are ideal candidates for pharmacogenomics are those where identifying early which patients will respond best to a medication can make a real difference in a treatment regimen," he said.

Perlegen also has worked in collaboration with London-based GlaxoSmithKline plc; New York-based Bristol-Myers Squibb Co.; London-based Unilever plc; New Brunswick, N.J.-based Johnson & Johnson; and Eli Lilly. It also began collaborating in October with Merck & Co. Inc., of Whitehouse Station, N.J.

With its last financing, Perlegen announced plans to build its own pipeline - a strategy that it launched in April with the in-licensing of its first product from Mitsubishi Pharma Corp., of Osaka, Japan. Perlegen holds exclusive worldwide rights, excluding Asia, to develop and commercialize a peroxisome proliferator activated receptor agonist (MCC-555) to treat diabetes and other metabolic disorders. It is evaluating a few other potential in-licensing candidates.

As pharmacogenomics enters the marketplace, Middlebrook said it is critical that consumers and physicians understand that Perlegen's work identifies patients that have a higher probability, not a certainty, of experiencing a side effect or of enjoying exceptional efficacy.

"Drug response also has an environmental component," he said.