CuraGen Corp.'s stock rose Thursday following news of a Cooperative Research and Development Agreement for its Phase II multiple myeloma compound PXD101, as well as a $62 million marketing deal for a subsidiary's genome sequencing systems.

The shares (NASDAQ:CRGN) rose 32 cents to close at $3.85.

CuraGen's majority-owned subsidiary, 454 Life Sciences, entered an exclusive five-year worldwide agreement with Basel, Switzerland-based F. Hoffmann-La Roche Ltd. for the promotion, sale and distribution of nanotechnology-based genome sequencing systems, including kits and reagents.

"The backing of a company like Roche with their distribution channels are significant for us," said Peter Dacey, 454's vice president of finance and operations. "It allows us to reach markets that, with our current staffing, we would not be able to reach. It also moves us toward financial self-sufficiency."

Terms call for 454, of Branford, Conn., to receive a margin on products manufactured for Roche Diagnostics, as well as royalties on net sales of licensed products. 454 also could receive up to $62 million in license fees, milestones related to instrument releases, minimum royalties and research funding. Dacey declined to break down the $62 million, but said milestone payments would be announced once achieved.

454 was formed in June 2000 to develop its platform technology, which enables researchers to sequence up to 100 times faster than current commercial platforms.

"The technology itself, we think, is very enabling and ultimately will lead to the path of personalized medicine," Dacey told BioWorld Today.

The technology represents the first radically new approach in the field to be commercialized since 1980, when two scientists won the Nobel prize for DNA sequencing. While 454's systems initially will be promoted in the research and development markets, Dacey said the company could later apply for 510(k) clearance from the FDA in order to market it as a diagnostic for certain diseases, such as HIV.

Roche will retain an option to negotiate distribution rights in the regulated diagnostic market and it might renew the distribution agreement upon meeting certain milestones.

While 454 began commercialization of its instrument systems and reagents in the first quarter, selling initially to the Broad Institute of MIT and Harvard, the agreement with Roche will broaden the reach and allow 454 to focus on its next-generation technology.

"The beauty is we're just at the beginning of the development cycle," Dacey said. "We're just starting, unlike other technologies that have been in development for several decades."

As a result of 454's agreement with Roche, CuraGen made some management changes. The company's founder and CEO, Jonathan Rothberg, accelerated his decision to step down and will remain on the CuraGen board and as chairman of 454. CuraGen board member Patrick Zenner, also a former president and CEO of Roche, will take on the role of chairman and acting CEO of CuraGen until a replacement is found.

And Christopher McLeod, CuraGen's executive vice president, will become president and CEO of 454.

Aside from its subsidiary's agreement with Roche, New Haven, Conn.-based CuraGen reported that its PXD101 partner, Copenhagen, Denmark-based TopoTarget A/S, signed a Cooperative Research and Development Agreement (CRADA) with the Division of Cancer Treatment and Diagnosis (DCTD) at the National Cancer Institute. CuraGen and TopoTarget are co-developing the histone deaceytlase (HDAC) inhibitor as a treatment for solid and hematologic cancers. It is in a Phase II trial for advanced multiple myeloma, which should be complete in the middle part of 2006.

"Under this CRADA with the NCI, the preclinical and nonclinical research will evaluate and help guide the development path for PXD101, as well as identify promising HDAC inhibitors from TopoTarget's library of compounds," said Glenn Schulman, CuraGen's manager of marketing and investor relations.

TopoTarget will work with DCTD and NCI to study PXD101 in order to better understand its antitumor activity. The parties also will select the best next generation of HDAC inhibitors to be developed as drug candidates from TopoTarget's library. CuraGen, which in-licensed PXD101 from TopoTarget last June, holds an exclusive option to select additional HDAC compounds from the library for clinical development. (See BioWorld Today, June 7, 2004.)

The CRADA complements the clinical trial agreement signed in August by CuraGen and the NCI because they both are focused on developing PXD101 for solid and hematologic cancers. The NCI is sponsoring several additional clinical trials of PXD101 in various cancers, both as a single-agent and in combination chemotherapy regimens.

The compound is a small-molecule HDAC inhibitor that could serve as a single-agent treatment, or one used in combination with other active anticancer agents. HDAC inhibitors target HDAC enzymes and have been shown to arrest growth of cancer cells, induce apoptosis, promote differentiation, inhibit angiogenesis and sensitize cancer cells to overcome drug resistance when used in combination with other agents.

"By targeting HDACs and inhibiting their activity," Schulman said, "it's a way to overcome a lot of the mechanisms that cancer uses to survive."