In a deal worth at least $37 million, Ibis Therapeutics will collaborate with Agouron Pharmaceuticals Inc. to discover and develop small-molecule drugs that bind to RNA.
"We're really excited because this is our first collaboration using the technology with a major pharmaceutical partner," said David Ecker, Ibis' managing director. "We've spent the last three to four years developing it with several prestigious research grants. While this is our first collaboration, we expect to have others. We are having conversations with other potential partners - some of which are in late-stage talks."
Ibis, a division of Isis Pharmaceuticals Inc., of Carlsbad, Calif., will use its proprietary technology, along with Agouron's expertise, to develop small-molecule drugs against certain RNA targets. Agouron, based in La Jolla, Calif., will fund collaborative research, pay an up-front technology access fee and make milestone payments totaling $37 million for the first product. There are also financial incentives if more than one product reaches market.
"The $37 million is the walking-around number," Ecker said. "Quite a bit of that is guaranteed over the three years. The rest is associated with product milestones. In addition, there are royalty payments."
Agouron will develop and commercialize drugs discovered in the collaboration.
"Agouron is really rolling up their sleeves and diving in," said Ecker. "They are bringing a lot to this partnership. They'll be carrying a lot of the workload. They are leaders in structure-based drug design and have the ability to take it to the next steps in chemistry. We possess complementary expertise in the structural biology of RNA and proteins that, when combined, create a powerful avenue for drug discovery."
Ibis' technology is "quite unique," Ecker said. "While Isis' work has been in antisense molecules that bind to proteins, ours is in small molecules that bind to the RNA. It's a very, very non-traditional approach. The technology allows us to rapidly sort through large numbers of RNA-binding molecules to identify the ones that bind to critical regions of our RNA targets."
The company's program has discovered low-molecular-weight, orally bioavailable drugs that work by binding to RNA targets implicated in disease process. The program is enabled by a technology platform that integrates functional genomics, informatics and an RNA-focused chemistry program coupled with novel, high-throughput mass spectrometry-based screening methods.
The companies will not disclose what therapeutic area the collaboration will focus on initially. "It's a monster market opportunity which is on the radar screens of a number of companies," Ecker said. "However, for strategic and proprietary reasons we're not disclosing it."
Isis Pharmaceuticals' stock (NASDAQ:ISIP) closed Monday at $13.125, up 6.3 cents.