LONDON ¿ Celltech plc is setting up a research collaboration with NeoGenesis Inc., of Cambridge, Mass., expanding its small-molecule drug discovery capabilities and reinforcing the strategy of running two parallel development pipelines of antibodies and new chemical entities that act on the same targets.

Melanie Lee, director of research at Celltech, based in Slough, UK, said during a teleconference that all the protein targets passed to NeoGenesis will be highly validated, tractable targets and will have passed stringent criteria in house. ¿NeoGenesis adds increased screening capability and diversity to our pipeline. By being careful with the targets in the first place, we hope to overcome the industry attrition rates,¿ she said.

Celltech is to make a $10 million equity investment in NeoGenesis, will pay for the research and make milestone payments. Any products will be commercialized by Celltech, with NeoGenesis receiving royalties.

NeoGenesis¿ core technology, automated ligand identification system, is a screening system that, coupled with its neoMorph compound library, rapidly identifies small-molecule ligands of high affinity and high selectivity. The neoMorph library currently contains more than 10 million compounds.

Lee said the screening method involves the direct binding of chemicals to the protein target and therefore would find molecules that could bind to any site on the protein.

The deal will enable Celltech to address two issues the industry as a whole is facing in the area of drug discovery: increasing the efficiency and throughput of screening and improving the chances of success; and providing the increased molecular diversity that is required to capitalize on the wealth of new available targets.

¿Celltech¿s capability now fairly actively resembles drug discovery in big pharma. The NeoGenesis deal adds capabilities that we could not achieve internally through organic growth,¿ Lee said.