West Coast Editor

A powerful vote of confidence in Gryphon Sciences Inc.’s chemically synthesized proteins came in the form of a deal worth up to $155 million with F. Hoffmann-La Roche Ltd. for a red blood cell booster that the latter will develop for chemotherapy and hemodialysis patients.

“It’s the normal kind of deal, and it’s important because Gryphon has had a long history which was not too straightforward,” said Friedhelm Blobel, president and CEO of South San Francisco-based Gryphon.

Blobel said the firm, founded in late 1993, “always had chemical protein synthesis [as a focus], but really not a clear business model. They tried all kinds of things in genomics, proteomics and biochemicals. None of these led anywhere.”

Gryphon was restructured in July 2000, after Blobel helped write a new business plan.

The drug at the center of the Roche deal, dubbed Synthetic Erythropoiesis Protein (SEP), is made by using chemical protein synthesis to create the backbone of the molecule. It incorporates well-defined polymers in order to increase the circulating half-life, and has been shown in animal tests to increase hematocrit for long periods.

“We completed the preclinical, and that certainly helped [close the deal],” Blobel said.

Basel, Switzerland-based Roche gets all rights exclusively worldwide, and will make up-front and milestone payments to Gryphon, as well as pay royalties.

Privately held Gryphon and its technology, which is focused on cytokines and growth factors, start with the predicted protein sequence from gene sequence data, a known protein sequence or just the goal of creating a novel, site-specifically modified derivative or other analogue of a natural protein. The company makes the protein backbone by linking peptides through chemical protein synthesis. Included in that process are polyethylene glycol-like molecules, intended to boost pharmacokinetics.

“It’s really key that we have not only chemical protein synthesis, but also polymer technology,” Blobel told BioWorld Today. “That’s what gives us the chance to play in the space of protein drugs. A naked protein would not make it.”

Among blood boosters, the best known is Thousand Oaks, Calif.-based Amgen Inc.’s blockbuster Epogen (epoetin alfa), and Gryphon’s different technology is what allows Roche to have confidence in the synthetic drug, Blobel noted.

“The Epogen market is certainly the biggest, and still very strongly growing, and there is a well-protected U.S. franchise for the Amgen family of products,” he acknowledged. If the SEP drug can “hit the market in 2007, that would be very aggressive,” Blobel said. “But why not be aggressive?”

In January, Gryphon raised $26 million in a Series B financing led by the Sprout Group, of Menlo Park, Calif., and said proceeds would lift its first potential product into clinical trials early this year, push drug candidates through Phase I/II studies and target still more candidates for development. (See BioWorld Today, Jan. 29, 2002.)

“Having Sprout as lead investors and Roche as our first pharma partner certainly gives us the wherewithal to go ahead more aggressively,” Blobel said.