• Adherex Technologies Inc., of Research Triangle Park, N.C., signed a letter of intent to reacquire the issued and outstanding shares of Cadherin Biomedical Inc., of Toronto. Cadherin was a wholly owned subsidiary of Adherex, which two years ago granted it an exclusive, royalty-free license to develop, market and distribute pharmaceuticals and therapeutics for non-cancer applications based on cadherin technology. Subsequently, Adherex distributed all of Cadherin's equity to Adherex shareholders of record. Adherex agreed to issue about 3.2 million shares to Cadherin shareholders, worth C$1.5 million (US$1.1 million). The agreement, which has been approved by both companies' boards, settles a claim by Adherex on account of goods and services rendered to Cadherin and a counterclaim filed by Cadherin. Closing of the transaction remains subject to Cadherin shareholders' approval.

• Astralis Ltd., of Fairfield, N.J., said CEO Mike Ajnsztajn and Chief Financial Officer Gina Tedesco submitted their resignations effective immediately with respect to their positions as members of the board and, effective Aug. 26, to their positions as CEO and chief financial officer. Jose O'Daly, chairman and president of research and development, will serve as interim CEO. Astralis focuses on treatments for immune system disorders and skin diseases.

• Avant Immunotherapeutics Inc., of Needham, Mass., demanded a delisting from the Berlin-Bremen Stock Exchange in an attempt to prevent trading practices that are banned in the U.S. Avant recently learned that it was one of more than 200 U.S. companies added to the exchange without its knowledge, consent or authorization. Avant discovers, develops and sells vaccines and therapeutics based on the human immune system.

• BioDelivery Sciences International Inc., of Newark, N.J., entered an oral understanding to out-license its formulation and delivery technology in connection with different compounds, particularly in oncology, to Sigma-Tau SpA, of Rome. Under the proposed licensing agreement, which is subject to further negotiation and execution, Sigma-Tau would pay an initial $250,000 up-front payment upon signing a letter of intent and an additional $750,000 upon the accomplishment of certain milestones leading to the filing of the first investigational new drug application for a compound formulated with the technology. Should a definitive license agreement be executed, BioDelivery said it would receive additional milestone payments and royalties on sales.

• Biopure Corp., of Cambridge, Mass., initiated a Phase II trial of its oxygen therapeutic Hemopure (hemoglobin glutamer - 250 [bovine]) in trauma patients at the Johannesburg Hospital Trauma Unit, a teaching hospital and Level I trauma center in South Africa. Hemopure is a universally compatible product administered intravenously to deliver oxygen to tissues. The single-center trial is randomized, single-blind, parallel-group and standard-therapy controlled. Patient enrollment has begun and about 50 trauma patients will be involved.

• BioSource International Inc., of Camarillo, Calif., said its board approved the expenditure of up to $10 million to repurchase its common stock. At the discretion of the company, purchases may be made from time to time in the open market at prevailing market prices and in privately negotiated transactions. BioSource focuses on functional genomics, proteomics and drug discovery through the development, manufacturing, marketing and distribution of biologically active reagent systems.

• Celera Diagnostics, a joint venture between Celera Genomics Group, of Rockville, Md., and Applied Biosystems, of Foster City, Calif., entered a collaboration with Merck & Co. Inc., of Whitehouse Station, N.J., to identify new targets for drug discovery and diagnostic markers related to Alzheimer's disease. Celera Diagnostics will conduct a functional genome scan to identify new gene associations with the disease, which Merck will fund. Merck will receive rights for therapeutic applications from the studies in Alzheimer's, as well as for certain other neurological disorders, while Celera Diagnostics will retain rights for diagnostic applications. Merck will make certain clinical milestone payments and pay a royalty on sales of resulting products. Additional terms were not disclosed.

• Cellegy Pharmaceuticals Inc., of South San Francisco, raised $10.3 million through a private placement of its common stock. The company sold about 3 million shares at $3.42 apiece, and also issued 604,000 warrants at an exercise price of $4.62 each, equal to a 35 percent premium to the offering price. Cellegy said the funding would allow it to continue its clinical and corporate development programs, and to begin preparing pre-launch commercialization plans for Cellegesic. Cellegy's stock (NASDAQ:CLGY) gained 35 cents Wednesday, or 10 percent, to close at $3.86.

• Cerus Corp., of Concord, Calif., received from the National Institute of Allergy and Infectious Diseases, a division of the National Institutes of Health in Bethesda, Md., a $3.8 million grant to develop an anthrax vaccine with greater potency than available vaccines. The grant will be awarded over a three-year period, and Cerus will receive about $1.4 million for the first year. The grant proposal was submitted in response to a request for applications under the NIAID Cooperative Research program for the development of vaccines for biodefense.

• Coastal Holdings Inc., of Houston, signed a draft investment agreement to purchase an equity interest in BioSight Ltd., of Karmiel, Israel. Terms were not disclosed. BioSight uses its S2DOT (Seek to Destroy Only Target) technology for the identification of disease-specific markers. The company develops pro-drug vectors for selective drug targeting.

• Diffusion Pharmaceuticals LLC, of Charlottesville, Va., completed a $2.1 million private equity round. The proceeds, along with a recent $1.2 million grant from the Office of Naval Research, will be used to support the preclinical development of trans-sodium crocetinate (TSC), its lead compound. The company is developing small-molecule therapeutics to treat oxygen deprivation at the cellular level.

• Dynavax Technologies Corp., of Berkeley, Calif., said a Phase IIa asthma challenge study confirmed the safety of inhaled immunostimulatory sequences (ISS) in asthmatic patients, and showed statistically significant pharmacological activity, based on the induction of genes associated with a reprogrammed immune response. ISS produced statistically significant elevations, in both peripheral blood and induced sputum, of genes induced by alpha-interferon, the main agent in the biological cascade triggered by ISS. No induction of those genes was observed in the placebo-treated patients.

• Enzo Biochem Inc., of New York, said it would appeal to the U.S. Court of Appeals the U.S. District Court's decision on Wednesday granting summary judgment in a suit by the company against Gen-Probe Inc., of San Diego, and Becton Dickinson & Co., of Franklin Lakes, N.J., charging infringement of Enzo's patent directed to probes for detecting the bacterium that causes gonorrhea. It is the second time that the district court judge granted summary judgment of invalidity against Enzo in the case. The first ruling, invalidating the patent for lack of written description, was made in January 2001 and reversed by the U.S. Court of Appeals in July 2002, which resulted in the case being returned to the district court for further proceedings.

• Gene Logic Inc., of Gaithersburg, Md., said NV Organon, of Oss, the Netherlands, agreed to use its platform of toxicogenomics services to assist in the assessment and prioritization of a preclinical pipeline. Over the next 18 months, Gene Logic will provide a series of ToxScreen reports and Mechanism of Toxicity reports for use in evaluating the safety and toxicity of Organon's drug candidates. Financial terms were not disclosed.

• GenVec Inc., of Gaithersburg, Md., said the Vaccine Research Center of the National Institute of Allergy and Infectious Diseases, a division of the National Institutes of Health in Bethesda, Md., initiated a Phase I study to test an HIV vaccine candidate developed using GenVec's gene delivery technology. The study will be sponsored, managed and funded by the NIAID and will employ candidates produced by GenVec under its subcontract with SAIC-Frederick Inc. and developed in collaboration with NIAID under a Cooperative Research and Development Agreement.

• Hematech LLC, of Sioux Falls, S.D., said the House and Senate conference committee on the fiscal year 2005 Defense Department Appropriations bill included $3 million to support Hematech's antibody development programs. The funding will be administered by the Army's Joint Vaccine Acquisition Program. The legislation has been approved by the House and Senate and is expected to be signed by President Bush. Hematech is developing a large-scale bovine production system to produce fully human polyclonal antibodies, which can be used for therapeutic applications.

• Idun Pharmaceuticals Inc., of San Diego, began a Phase II study of IDN-6556 in patients infected with hepatitis C virus. The dose-response trial will evaluate whether the compound can decrease liver damage, which can be caused by hepatitis C infection. Participants, who previously have failed to respond to existing drugs, will receive one of several doses of IDN-6556, or placebo, given orally as a monotherapy for three months. The study, which will be conducted at 15 U.S. sites, is expected to enroll up to 200 patients.

• Illumina Inc., of San Diego, received notification that a lawsuit has been filed against it by Affymetrix Inc., of Santa Clara, Calif., alleging infringement of six Affymetrix patents. The patents were issued to Affymetrix between 1996 and 2003 and relate to arrays, software and hardware. Illumina said it has meritorious defenses and plans to "vigorously defend itself" against the suit. Illumina is developing tools that permit large-scale analysis of genetic variation and function, including its BeadArray technology.

• Inflazyme Pharmaceuticals Ltd., of Vancouver, British Columbia, laid off half its work force as part of a plan to refocus its research and development efforts to concentrate primarily on its complement-inhibition and Prodaptin technologies. The decision follows a pair of recent drug development setbacks, including Phase I and II failures in the last two months. The company dropped its Phase II product for asthma, IPL512,602, about four weeks after dropping a Phase I antithrombotic agent, GH9001, that it called a non-core asset. Inflazyme consolidated its facilities and reduced staff by 42, leaving 40 employees. The remaining staff includes people from both Inflazyme and Adprotech Ltd., of Cambridge, UK, which it recently acquired. The consolidation of facilities into one site in Vancouver involves closing the Adprotech site in the UK and terminating the GlycoDesign Inc. lease in Toronto, as well as halting a thrombosis collaboration with the Henderson Research Group in Hamilton, Ontario. As of June 30, Inflazyme had about $29 million in cash and short-term investments, which it said would be sufficient to take it into the second quarter of 2006. (See BioWorld Today, May 17, 2004, and June 21, 2004.)

• Isolagen Inc., of Houston, said six-month marker data from a Phase III study of its Isolagen Process indicate a positive response in 82 percent of Isolagen-treated patients who were evaluated. The ongoing study is designed to assess improvement for facial contour deformities, and the product is in two additional Phase III trials under a special protocol assessment from the FDA for facial wrinkles.

• Miraculins Inc., of Winnepeg, Manitoba, entered a collaboration with the Edmonton Prostate and Urological Research Centre to augment the company's development of diagnostic tools for prostate cancer. The agreement provides Miraculins with clinical samples from prostate cancer patients matched with samples from control patients.

• Neurologix Inc., of Fort Lee, N.J., said its board approved an amendment and restatement that would effect a reverse stock split of the shares of its common stock at a ratio of 1 for 25, and reduce the number of authorized shares of common stock from 750 million to 60 million. Neurologix develops gene therapies for treating central nervous system disorders.

• Nymox Pharmaceutical Corp., of Maywood, N.J., said Phase I/II data showed that at one month, subjects treated with NX-1207 for benign prostatic hyperplasia showed overall mean symptom improvement of about 6.9 points. That compared to a 0.5 for improvement control patients, a statistically significant difference (p=0.0352). The company also reported significant improvements in prostate size reduction, and there were no significant adverse side effects.

• Peplin Biotech Ltd., of Brisbane, Australia, said its lead molecule, PEP005, has shown selective activity against acute myelogenous leukemia in preclinical studies. Based on that and other preclinical data, the company plans to file an investigational new drug application with the FDA to begin clinical trials of an intravenous formulation of the compound for leukemia.

• Santarus Inc., of San Diego, completed its follow-on offering of 6.9 million common shares at $9.50 each, including 900,000 shares sold pursuant to the full exercise of an overallotment option granted to the underwriters. SG Cowen & Co. LLC and UBS Investment Bank acted as joint book-running managers, and Thomas Weisel Partners LLC and RBC Capital Markets acted as co-managers of the $65.5 million offering. The shares priced earlier this week. (See BioWorld Today, July 26, 2004.)

• Serologicals Corp., of Atlanta, completed its previously announced acquisition of AltaGen Biosciences Inc., of Morgan Hill, Calif., the parent company of Sierra BioSource, a provider of contract research and development services to the cell culture industry. Serologicals said the acquisition is expected to be accretive during this fiscal year.

• Sirna Therapeutics Inc., of Boulder, Colo., and Archemix Corp., of Cambridge, Mass., entered an exclusive four-year process and analytical development and manufacturing alliance for all of Archemix's cGMP aptamers through Phase IIa development. Sirna also granted Archemix a worldwide, perpetual, nonexclusive license to its intellectual property for the manufacture and commercialization of aptamers. In addition to payments for the manufacture of aptamers, Sirna will receive certain downstream consideration for the license granted to Archemix.

• StemCells Inc., of Palo Alto, Calif., said preclinical data published in the early online edition of the Proceedings of the National Academy of Science detailed findings from a study of human neural stem cells belonging to the company. Results showed that the transplanted cells are capable of surviving in the brain of immunosuppressed stroked rats. The research was conducted at Stanford University in Palo Alto. The company's stock (NASDAQ:STEM) fell 23 cents Wednesday, or 12.9 percent, to close at $1.56.

• Targeted Genetics Corp., of Seattle, completed the sale of its majority owned subsidiary, CellExSys Inc., to Chromos Molecular Systems Inc., of Burnaby, British Columbia. Chromos issued 1.5 million of its common shares and a secured convertible debenture worth about $2.5 million to CellExSys shareholders. The debenture will be payable by Chromos at its option in either cash or by the issuance of its common shares. In combination with the shares of Chromos stock issued at closing, if the debenture is fully paid in Chromos common shares, the shareholders of CellExSys would receive up to 3.5 million shares, representing about 17.2 percent of the issued and outstanding shares of Chromos as of the closing date. At closing, Targeted Genetics owned about 80 percent of CellExSys.

• TransForm Pharmaceuticals Inc., of Lexington, Mass., entered an agreement to use its informatics capabilities to develop a method of identifying optimal formulations for preclinical drug candidates for Eli Lilly and Co., of Indianapolis. TransForm will develop a suite of tools intended to allow Lilly to improve its preclinical compounds by moving them into in vivo toxicology studies earlier and with more reliable formulations. TransForm will retain rights to use the tools to improve its own pipeline of product candidates. Financial terms were not disclosed.

• TranXenoGen Inc., of Shrewsbury, Mass., reduced its work force to three people from 14 as part of a plan to scale back operations and sell assets because fund-raising and partnering efforts have proved unsuccessful to date. The remaining employees will focus on transforming the firm into a technology company to license and sell its technology portfolio and advance its preclinical anti-neoplastic urinary protein product for cancer to the point it can be licensed to a development partner. TranXenoGen's unrestricted cash position at June 30 totaled $732,000, which it said is not sufficient to fund operations beyond this quarter at its current level of operations.