Knowing that even the most lofty tasks are accomplished one move at a time, Celera Genomics Group made a move pursuing its own lofty goal of becoming a biopharmaceutical company by acquiring a collection of early compounds from Bayer AG.
"It's a meaningful first step in the goal Celera has in building a robust preclinical and clinical pipeline," said David Block, executive vice president of Celera and chief operating officer of Celera's therapeutics business, speaking to BioWorld Today from the UBS Warburg conference in New York.
The deal with Bayer has deep biotechnology roots, going back to 1994 when Arris Pharmaceutical Corp. signed a potential $70 million deal with Bayer, of Leverkusen, Germany, in areas surrounding inhibitors of tryptase and chymase. Of that potential sum, $42 million was in up-front and research payments. Arris eventually merged with Sequana Therapeutics Inc. in a stock swap valued at $166 million and became Axys Pharmaceuticals Inc. Celera then bought Axys in 2001 for $173 million, inheriting the deal with Bayer, and Axys now functions as Celera South San Francisco. (See BioWorld Today, Nov. 29, 1994; Nov. 4, 1997; and June 14, 2001.)
But, as Block put it, there have "always only been two parties involved" in the deal around the compounds. Rockville, Md.-based Celera, Block said, gets "an entire set of compounds and associated intellectual property that comes out of that - all the inventions that were made by Arris/Axys' that had been assigned to Bayer" and the inventions Bayer made itself.
Celera now has rights to the compounds in all fields - including the primary application of oral agents to treat asthma - that existed under the collaboration, but in doing so, the companies terminated the deal originally established by Bayer and Arris back in 1994. Financial terms of Celera's rights acquisition were not disclosed.
Celera plans to move ahead with the compounds as part of its drive to become what so many in biotechnology are striving to become - product-bearing companies. Even more so in a down market, investors favor companies with drugs to sell, and Celera aspires to join those ranks. But it will evaluate its new acquisition before making public its development schedule.
"We don't have strict timelines set," Block said. "We have to get possession of everything [from Bayer] to state that more firmly. We want to do some more extensive [investigational new drug]-enabling work. We are in the midst of doing our business planning, and we will present it to our board in November and make it public in the December-to-February time frame."
Celera Genomics President Kathy Ordonez highlighted at the UBS Warburg conference the four areas where the company has preclinical programs: anticoagulation, osteoporosis, the coupled area of inflammation and autoimmune, and oncology. Its programs furthest along are a Cathepsin S program partnered with Aventis SA, of Frankfurt, Germany; a Cathepsin K program partnered with Merck & Co. Inc., of Whitehouse Station, N.J.; an unpartnered program around Factor VIIa; and now the newly acquired tryptase program.
When Celera snapped up Axys, Block said, Celera was then seen as "a chemistry powerhouse and genomics powerhouse." But, he said, "there were gaping holes left in us becoming a biopharmaceutical company.
"We are moving from a largely target-finding company and information company to a company with a broad clinical and preclinical pipeline," Block said. "When people think of Celera, they think of a platform technology company. This is just one step in many steps that we will take in order to become a biopharmaceutical company."
Celera's stock (NYSE:CRA) rose 28 cents Tuesday to close at $7.35.