West Coast Editor

Sealing their second deal in two years, Sunesis Pharmaceuticals Inc. and Merck & Co. Inc. entered a pact to discover oral drugs for viral infections.

"It's typically structured, [in line with] all of our research-based collaborations," which generally include a multimillion dollar up-front fee, said Daniel Swisher, CEO of South San Francisco-based Sunesis.

Privately held Sunesis is providing Merck, of Whitehouse Station, N.J., with a series of small-molecule compounds derived from its proprietary fragment-based drug discovery platform called Tethering, and Merck will advance them into lead optimization, preclinical development and clinical studies.

Full financial details were not disclosed, but Merck - which gets an exclusive worldwide license to any products that come out of the deal - has agreed to pay annual license fees, along with the up-front payment and development milestones, plus royalties.

In February 2003, Sunesis and Merck signed a deal to find oral therapeutics for Alzheimer's disease. (See BioWorld Today, Feb. 20, 2003.)

"One distinction is that we have a large research team working on base on the Alzheimer's [program]," Swisher said, whereas work at Sunesis in the antivirals program will be minimal.

"That was very deliberate on our part," he said. "We've got a very powerful discovery engine that cuts across all therapeutic areas," and the company has "had to pick very selectively which areas we would pursue on our own."

An area of primary focus in-house is oncology, Swisher said.

"We have a cytotoxic cell-cycle modulator that's in Phase I development, SNS-595," he said, and two cancer kinase programs are at the preclinical stage. "We're looking toward 2006 to get at least one of those in the clinic," he added.

Fragment-based research is becoming more active, Swisher said, since it represents an "opportunity to find novel starting points on targets of high value that have been challenging to traditional drug discovery. You can discover drugs in pieces and get novel toeholds on the target protein." With that approach, a drug fragment found to bind to the active site of a protein shows researchers where to start in developing a compound that might work.

Earlier this week, Locus Pharmaceuticals Inc. and Procter & Gamble Pharmaceuticals Inc. entered a diabetes research deal implementing the former's 40,000-member set of fragments. (See BioWorld Today, July 27, 2004.)

Sunesis also has deals with Biogen Idec Inc., of Cambridge, Mass., and Johnson & Johnson Pharmaceutical Research & Development, a unit of New Brunswick, N.J.-based J&J. Over the past three years, Sunesis has gained about $25 million through its partnerships with Merck, Biogen Idec and J&J, and the firm expects revenues to increase as each of those programs head toward the clinic.

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