BioWorld International Correspondent

LONDON - Four years after the genomics bubble burst, a new player, VASTox plc, is heading for an initial public offering to raise £15 million (US$26.7 million) and aiming to lure investors with the claim it has worked out how to make genomics a commercial success.

"That's not the only area where we intend to break the model," CEO Steve Lee told BioWorld International. "The £15 million we are setting out to raise is going to last forever. We will spend some of it, but we see it basically as a strategic asset that will enable us to do deals."

The flotation on the Alternative Investment Market in London would give VASTox a market capitalization of £45 million.

VASTox's new brand of "chemical genomics" reverses the existing gene-to-screen paradigm, whereby genomics is used to throw up new targets that are then subjected to high-throughput screens. In its screen-to-gene approach, chemical libraries are probed in vivo, first in zebrafish, then in fruit flies, simultaneously identifying drug targets for human disease, and the molecules that modulate them.

The targets discovered are by definition drugable.

"Not only that, you can look at what a particular molecule does to other genes on the same pathway, or across other pathways," Lee said. "The level of homology between humans and zebrafish means you are effectively in vivo, but unlike mice you can do high-throughput screening and observe the effects directly."

At present more than 1,000 developmental phenotypes have been characterized in zebrafish, many of which are associated with molecular pathways and specific gene disruptions. The whole zebrafish genome sequence is due to be completed by the end of 2005. Fruit flies are used for secondary screening because it is very easy to generate transgenics, mutations and deletions.

In the 20 months since VASTox was spun out of Oxford University it has built up revenues of £250,000 providing screening services. "We've done that without trying very hard," Lee said. "We will grow that aspect of the business and advance two proprietary drug development programs in muscular dystrophy and antibiotic resistance."

The academic force behind VASTox is Steve Davies, a chemistry professor who was responsible for the formation of the drug discovery services company Oxford Asymmetry, a business that went public and subsequently was acquired by the German company Evotec OAI for £316 million.

"Steve Davies defined the chemistry services space when he founded Oxford Asymmetry; now he is doing the same with chemical genomics," Lee said.

Davies also was a leading proponent of the argument that, to improve safety, drugs should be single isomers rather than racemic mixtures, a position since accepted by the regulators. Lee said, "Similarly, chemical genomics will clean things up for the regulatory process, because it will in effect enable you to do Phase IV studies before a product goes on the market."

VASTox also argued that its technology is animal-rights friendly. "You will cut down on furry and higher-animal testing," Lee said. "We foresee it becoming a regulatory requirement because in effect you can be in 10,000 humans at the very beginning of the drug discovery process."

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