By Brady Huggett
The biotechnology industry has three major markets: North America, Europe and Japan. NeoGenesis Inc., already having deals in two of those areas, said Wednesday it is collaborating with its first Japanese company, Mitsubishi-Tokyo Pharmaceuticals Inc.
NeoGenesis, of Cambridge, Mass., will generate leads from a target supplied by Tokyo-based Mitsubishi-Tokyo Pharmaceuticals in an area NeoGenesis¿ president and chief scientific officer, Satish Jindal, called ¿high priority.¿
¿This is our first collaboration with a Japanese company, so it¿s very important to us,¿ Jindal told BioWorld Today. ¿It happened relatively fast ¿ it took less than one year. I think Japanese collaborations take a longer time, usually, compared to U.S. collaborations.¿
Mitsubishi-Tokyo was formed through a fusion of Mitsubishi Chemical Corp. and Tokyo Tanabe Co. Ltd. It is a subsidiary of Mitsubishi Chemical.
Similar to other deals NeoGenesis has done, the agreement will use the company¿s Automated Ligand Identification System and neoMorph library with its 10 million drug-like compounds to screen for and optimize leads. The deal is not as financially rewarding as NeoGenesis¿ collaboration with Slough, UK-based Celltech Group plc ¿ potentially worth $20 million ¿ or its expansion deal with Schering-Plough Corp., of Madison, N.J., worth up to $25 million, but deals are valued overall in different ways, Jindal said.
¿Our deals with Celltech, Oxford [GlycoSciences plc, of Oxford, UK], and Schering-Plough, those are more substantial, compared to this one,¿ he said. ¿But this is important because it is a Japanese company, the disease and the nature of the target are very important, and the drug leads we provide will move quickly toward the clinic.¿
NeoGenesis will receive discovery payments as well as milestones and mid-range single-digit royalties. The collaboration has the potential to grow, Jindal said.
¿Most Japanese companies start on a modest scale and then expand,¿ Jindal said. ¿I think this [collaboration] is one of those types.¿
When NeoGenesis expanded its work with Biogen Inc., of Cambridge, Mass., in July, Jindal warned that ¿two or three¿ more deals would be readily forthcoming. Days later NeoGenesis announced the deal with Celltech, then stretched its work with Schering-Plough earlier this month. Following this deal with Mitsubishi, Jindal said, one remains, an agreement expected to be announced within 30 days. The big deals, though, are yet to come, Jindal said. (See BioWorld Today, July 10, 2001; July 13, 2001; and Aug. 7, 2001.)
¿We are in discussion with companies for collaborations which will focus on medically important protein families,¿ he said. ¿So we will make exclusive partnerships with companies based upon a protein family. Hopefully, before the end of this year, we will have at least one signed.¿
With that marked difference ¿ an entire protein family to generate leads off, as opposed to just a few members as in the Mitsubishi deal ¿ the time, effort and financial rewards of those deals will be greater.
¿These will be big deals, very substantial deals, in terms of scale and commitment,¿ Jindal said.
With deals signed and work underway, NeoGenesis has an influx of money, something many private companies lament. Collaborations and partnerships with big names, such as Biogen Inc., Schering-Plough Corp. and Merck & Co., have thrust NeoGenesis¿ name into prominence. And with an upturn in the market, NeoGenesis would be set to jump into the public market, Jindal said.
¿We will be ready,¿ he said. ¿We are thinking about it and we are confident. With the story we have, I don¿t see any problem with an IPO.¿