Onyx Pharmaceuticals Inc. entered into an agreement with Proacta Therapeutics Ltd. to evaluate and potentially develop cancer therapeutics.

Richmond, Calif.-based Onyx will provide the therapeutic viruses to Auckland, New Zealand-based Proacta, which will conduct all research activities. Based on the results, the companies may enter a further collaboration or license arrangement to develop a nitroreductase-armed virus product.

“There’s a potential for some real synergy,” said Greg Giotta, Onyx’s vice president and chief legal counsel. “We will wait and see, and if the results are satisfactory, we’ll sit down and negotiate a development sort of deal.”

Specific future terms were not discussed, Giotta said, with regard to which company would own rights or licenses to resultant products.

In the near term, the companies will investigate arming Onyx therapeutic viruses that replicate in and destroy cancer cells with Proacta’s prodrug technology.

“They have done a lot of work in isolating and cloning genes that convert prodrugs into drugs,” Giotta said. “They have intellectual property on certain prodrug-converting enzymes, such as nitroreductase. Our expertise is in viruses, particularly adenoviruses in treating cancer, and molecular biology. In the agreement, we’ll put their genes in our viruses and they will test the viruses with the prodrugs.”

The inactive prodrug is designed to circulate throughout a body, but when it comes in contact with a virus-infected tumor cell, the prodrug will be converted into an active drug to combat the tumor cells.

Proacta holds exclusive worldwide rights to 25 patent families. Its technology has shown positive results in quickly destroying cancer tumors in laboratory tests. The agreement will allow Proacta to evaluate prodrugs that are activated by the enzyme nitroreductase, one of four separate prodrug technology platforms the company has in development.

Proacta was formed late last year by Auckland UniServices Ltd., of Auckland, as well as Cancer Research Ventures Ltd. and the Institute of Cancer Research, both of London. The company is focused on developing new treatment modalities directly targeting tumors. Its prodrug-activation strategies include a number of proprietary enzymes delivered to the tumor by gene therapy.

Onyx, through its technologies that target the molecular basis of cancer, is developing its lead anticancer agents, ONYX-015 and BAY 43-9006. The former candidate is in the Phase III stage, while the latter, which is being developed with Bayer AG, is in late Phase I testing.

“ONYX-015 is a mutant adenovirus, so you can use this virus to put into it a prodrug-converting enzyme,” Giotta said. BAY 43-9006 is targeted for Phase II very soon, he said.