Staff Writer

Aton Pharma Inc. came under the gaze of Merck & Co. Inc. as part of the pharmaceutical company's strategy to make targeted acquisitions of biotech companies.

The two companies signed a definitive agreement in which Merck will acquire all of Aton's equity, making the private company a wholly owned subsidiary.

"We have been developing SAHA and we were getting some pretty exciting results," said Nicholas Bacopoulos, president and CEO of Aton Pharma. "And we were looking for a way to expedite the growth of the program. Merck was extremely attractive because they are really committed to creating a cancer portfolio. We were able to strike the right deal."

Specific financial details of the acquisition were not disclosed, but it does include up-front and contingent payments based upon the regulatory filing, approval and sale of Aton products - including its lead cancer drug SAHA, which has orphan drug designation to treat multiple myeloma.

"I think that the acquisition of Aton complements the cancer research that is taking place at Merck," said Janet Skidmore, a spokeswoman for Whitehouse Station, N.J.-based Merck, pointing to the company's acquisition of Rosetta Inpharmatics in 2001 that brought Merck gene expression profiling technology.

"The acquisition of Aton really complements that technology," she said.

Aton Pharma, of Tarrytown, New York, was founded in April 2001 and is focused on identifying and developing small-molecule inhibitors of chromatin-modifying enzymes. A year ago, it completed its Series A financing, raising a total of $48.7 million with three tranches. (See BioWorld Today, Jan. 9, 2003.)

The company will provide Merck its lead candidate, suberoylanilide hydroxamic acid or SAHA, which is in Phase II trials, and another cancer compound, pyroxamide, which is being studied in Phase I work. Both products are histone deacetylase (HDAC) inhibitors.

"We're very pleased with the outcome," Bacopoulos told BioWorld Today. "We look forward to an exciting development program for our pipeline."

Aton Pharma's technology was discovered in the laboratories of co-founders Ronald Breslow and Paul Marks at Columbia University and Memorial Sloan-Kettering Cancer Center. Marks is the president emeritus of Memorial Sloan-Kettering.

Skidmore said Aton Pharma came to Merck's attention because it established itself in just a few years as a company filled with oncology expertise.

"We're talking about some heavy hitters in the realm of oncology research," she told BioWorld Today.

SAHA is in a Phase II trial to treat cutaneous T-cell lymphoma, a slow-growing form of cancer in which some of the body's white blood cells become malignant. It also is being studied in leukemia, multiple myeloma and solid tumors such as breast and colorectal cancer. Phase I data of SAHA have demonstrated that it is readily bioavailable and results in prolongation of acetylated histone accumulation in peripheral blood mononuclear cells, compared to an identical dose administered intravenously. It inhibited its target enzyme, HDAC, at well-tolerated doses.

Skidmore said that while Aton is best known for its cancer research, the company also was looking at treatments in other areas.

"There is the possibility that these compounds might be examined for other serious disease" by Merck, she said.

Cancer is second to heart disease as the leading cause of death in the U.S. Half of the cancer deaths in the U.S. are from breast, lung, colorectal and prostate cancers, the American Cancer Society said.

In December, Aton Pharma reported Phase II data that showed SAHA treatment resulted in five partial remissions among 13 patients with refractory or relapsed cutaneous T-cell lymphoma who were unresponsive to conventional therapies. Another five patients had stable disease and three progressed on therapy. Phase I data in patients with advanced leukemias or myelodysplastic syndromes showed that histone hyperacetylation was induced in the peripheral blood and marrow of all three patients treated at the first dose level. That trial began in July at the University of Texas M.D. Anderson Cancer Center in Houston.