BioWorld International Correspondent

LONDON - PIramed Ltd, a 2-year-old, private UK biotech company, landed a deal worth a headline $230 million with Genentech Inc. for preclinical-stage inhibitors of the signal transduction enzyme phosphatidylinositol-3-kinase (PI 3-kinase), which is implicated in a range of cancers.

Although the company said the deal was worth $230 million, it declined to give a breakdown of the money, saying only that it included an up-front payment, research funding and milestone payments. In addition, PIramed is entitled to royalties on sales of any products that reach the market.

The company will continue the preclinical work, and South San Francisco-based Genentech will be responsible for all subsequent clinical development and commercialization. PIramed has retained rights to commercialize certain products in territories outside the U.S.

Michael Moore, CEO of PIramed, told BioWorld Today, "This would be a significant deal for anyone, but for a company of our size, founded in 2003 and with just $17 million of funding, it is a great achievement and emphasizes the quality of our leads."

The lead compounds are in late-stage optimization. Moore said it is now up to Genentech as to how quickly they progress into the clinic, and for which indications. "This is a collaborative agreement, but clearly, Genentech takes full responsibility for all aspects of clinical development," he said. "We will be working hand in glove to select candidates for onward development."

PI 3-kinase, which has key roles in cell cycle regulation, proliferation, survival, apoptosis and motility, was discovered by Mike Waterfield and Peter Parker, who co-founded PIramed along with Paul Workman. The research was carried out by the Ludwig Institute for Cancer Research, Cancer Research UK and the Institute of Cancer Research, in collaboration with Yamanouchi Pharmaceutical Company of Japan (now Astellas Pharma Inc.), which no longer holds any rights to it.

PIramed has exclusive licenses to novel chemical entities that arose from the collaboration and to screens for PI 3-kinase.

Slough-based PIramed received Series A funding and convertible loan notes of $17 million from New York-based JPMorgan Partners and London-based Merlin Biosciences in July 2003 and August 2005. Srinivas Akkaraju, a partner at JPMorgan in San Francisco who helped set up PIramed, said he was attracted because of the quality of the science behind PI 3-kinase.

"There's a tremendous amount of scientific data suggesting it is a target worth pursuing - it is relevant to a wide range of tumors, including chemotherapy-resistant tumors," he told BioWorld Today. "I was also attracted because most of the signal transduction inhibitors to date are protein kinase inhibitors. There are far fewer people out there with experience of lipid kinases."

The deal does not represent an exit for the investors but is an important stage in the evolution of the company, Akkaraju added. "I believe competition has increased for access to high quality, unique assets, and so I'm not surprised by the biobucks of this deal. In fact, average deal sizes for early clinical programs are larger than this, so although I think it's a great deal for PIramed, I don't think it's unprecedented."

Moore said that the deal puts PIramed in a strong position for the future, enabling it to develop inhibitors of another isoform of PI 3-kinase in inflammatory disease and bring on some earlier-stage projects.