Affixing a schedule to what it called the largest Canadian drug development deal between a large pharmaceutical company and a biotechnology company, Isotechnika Inc. said it and partner F. Hoffmann-La Roche Ltd. are delaying a Phase II trial of ISATX247 for rheumatoid arthritis to instead zero in on the transplantation field.

The agreement, with a reported value of up to $215 million to Isotechnika if all milestones are met, was signed in April. Since then, the companies have been reviewing the product and its indications, deciding the areas in which to forge forward first.

Following that review the decision was made "to focus our efforts on transplantation," said Randall Yatscoff, Isotechnika's president and chief operating officer, saying that included initiating trials in heart and liver transplantation.

"[Transplantation] is where this drug will have the greatest impact," he said. "There are no other drugs in this class being developed for the transplantation indication."

ISATX247 is a calcineurin inhibitor. The drug is in two Phase II trials - for psoriasis and renal transplantation - that will continue as planned. Pushing aside the previously planned rheumatoid arthritis Phase II trial - most likely until 2003, Yatscoff said - will allow Isotechnika and Roche to concentrate on the area where ISATX247 might be able to do the most: transplantation. Yatscoff estimated the global annual market for the product in that area to be "nearly $2 billion."

The progress of ISATX247 is governed by the companies through a joint committee. Over the next two months the committee will decide when to begin the liver and heart trials, and a more definitive timeline for that work should be made public sometime this summer, Yatscoff told BioWorld Today. The work under way is enjoying "excellent" progress, he said.

"The psoriasis trial is nearing completion of enrollment and the renal transplant recruitment has increased substantially - it's nearly reached the halfway mark," he said, adding that data from the psoriasis trial might be available by the fourth quarter. For the renal transplantation trial, data might be seen in early 2003.

The deal is a financial boon for Edmonton, Alberta-based Isotechnika. Roche gained exclusive worldwide marketing rights to the product in the agreement, but agreed to pay 70 percent of development costs and give Isotechnika a percentage of gross profits. Add the research and development funding - which Yatscoff estimated at "a couple of hundred million dollars" - to the potential milestones, and the deal tops out at a value of more than $400 million, he said. (See BioWorld Today, April 10, 2002.)

Isotechnika has a diagnostics division, called Isodiagnostika, which develops and commercializes diagnostic kits using stable isotopes for the detection of various ailments, and the company also manufactures nondispersive infrared spectrometers.

Pharmaceutical giant Roche, based in Basel, Switzerland, certainly has no shortage of programs to attend to or areas to research. But with Isotechnika, the near term is transplantation.

"What we've been told is to focus our energy and we are doing that here, to where this drug will have the biggest impact," Yatscoff said. "That's the long and short of it."

Isotechnika's stock on the Toronto Stock Exchange (TSE:ISA) rose C12 cents Friday to close at C$4.95.

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