As Gloucester Pharmaceuticals Inc. nears its one-year anniversary, the company in-licensed its first cancer agent, FK228.

The Cambridge, Mass.-based company, which was founded in May 2003, acquired an exclusive worldwide license to develop and commercialize FK228 from Osaka, Japan-based Fujisawa Pharmaceutical Co. Ltd.

The product is in Phase II trials to treat renal-cell carcinoma and hormone-refractory prostate cancer. It also is being studied in a third indication - cutaneous T-cell lymphoma (CTCL) - under a cooperative research and development agreement between Fujisawa and the National Cancer Institute (NCI) in Bethesda, Md.

Gloucester plans to take over all three studies.

"If you look globally at these three indications, we're talking about a $2 billion market for all of these together," said Jay Mohr, president and CEO of Gloucester. "The entire cancer market is nearing $20 billion, so we're talking about a good 10 percent of that."

FK228 (depsipeptide) is part of a new class of cancer agents known as histone deacetylase (HDAC) inhibitors. Histone deacetylation is instrumental in the regulation of gene expression. In addition to inhibiting HDAC, FK228 has been found to cause cell-cycle arrest, differentiation and apoptotic cell death. The company believes FK228, because of its potential for improved efficacy, offers an advantage over traditional cytotoxic agents.

Fujisawa will receive an up-front licensing fee. It also is entitled to research and development and commercialization milestone payments and royalties on sales. Specific financial details were not disclosed.

Mohr said FK228 could be on the market within the next few years.

"Our immediate plan is to meet with the FDA to discuss with them a registration strategy," he said. "We have very rare types of lymphoma [CTCL], which could in theory allow us to get to the market faster because this is a high unmet medical need."

In addition to the Phase II CTCL study, the NCI also is looking at FK228 as both a monotherapy and a combination therapy in Phase I and II trials for other hematologic and solid-tumor indications.

Along with FK228, the agreement with Fujisawa includes the preclinical compound FR135313, also an HDAC inhibitor, which might be a follow-on compound downstream after Gloucester has built its franchise around FK228, Mohr said.

"The compounds that we have already acquired, but will continue to seek out in the marketplace, are unique in terms of their mechanism," Mohr told BioWorld Today. "They are more on the cutting edge than they are compounds that are being rescued."

Fujisawa saw some very positive results with FK228, Mohr said, but the company is no longer interested in developing cancer compounds. It is out-licensing the compounds in order to focus on infectious diseases, autoimmune diseases and transplant rejection.

A number of pharmaceutical companies are working on HDAC inhibitors, validating the mechanism of action, Mohr said.

When Merck & Co. Inc., of Whitehouse Station, N.J., acquired Aton Pharma Inc., of Tarrytown, N.Y., it gained rights to SAHA, an HDAC inhibitor. And Novartis AG, of Basel, Switzerland, and Berlin-based Schering AG also are working on HDAC inhibitors. (See BioWorld Today, Feb. 25, 2004.)

Mohr said Gloucester will continue to search for cancer compounds to in-license.

"We founded Gloucester a year ago and the business model has remained the same, that we were going to focus on building a small-molecule cancer therapeutic company with development-stage compounds that we've in-licensed," Mohr said. "We're looking for compounds that are novel, that have newer mechanisms of action, but also have demonstrated activity."

Mohr recently took the helm as CEO of the new company. He last worked as president and chief business officer at Variagenics Inc., of Cambridge, Mass., where he helped close the company's $56 million merger with Hyseq Pharmaceuticals Inc., forming Sunnyvale, Calif.-based Nuvelo Inc.

Before signing on as CEO, he served as chief business officer at Gloucester. Mohr founded Gloucester along with Martin Vogelbaum and Gregory Verdine, who are directors of the company. Vogelbaum is a general partner with New York-based Apple Tree Partners - the company's sole investor in its Series A financing. Verdine is an Erving professor of chemistry at Harvard University.

Mohr declined to say how much was raised in that first financing, but another fund raising is expected soon.

"We'll be starting another round of financing later on this year," Mohr said.

The company plans to have about 15 people on staff by the end of this year.