By Kim Coghill

Washington Editor

Incyte Genomics Inc. and Lexicon Genetics Inc. entered a four-pronged collaboration agreement aimed at building each other¿s technologies and developing therapeutic protein drug products.

The companies would not release details of the financial arrangement except to say that each will be entitled to milestone and royalty payments resulting from the collaboration. Several products are expected to result from the alliance.

¿Today, two of the most powerful technology platform patent portfolios in the biotechnology industry are to be linked for the mutual benefit of Lexicon and Incyte and for our partners in the pharmaceutical industry,¿ Roy Whitfield, CEO of Palo Alto, Calif.-based Incyte, said in a conference call Thursday. ¿By combining Incyte¿s patent rights and target validation expertise with Lexicon¿s knowledge of in vivo gene function, both companies are primed to build a significant pipeline of therapeutic protein products.¿

Under the agreement, each company will select 250 secreted proteins for functional characterization, and Lexicon will apply its in vivo mammalian validation technologies to determine the therapeutic utility of the proteins. Lexicon and Incyte will share discoveries and related patent rights, and advance them into development and commercialization opportunities.

¿All of us know that great potential exists in the genome for finding new blockbuster therapeutic protein products,¿ Arthur Sands, president and CEO of The Woodlands, Texas-based Lexicon, said in the conference call. ¿Relatively few have been developed from the clinic, but our [technologies] combined will lead to a higher rate of drug discovery and success.¿

In another part of the agreement, Incyte will co-promote Lexicon¿s LexVision database in North America and Europe, according to Sands, who said it is a natural step to tap into Incyte¿s vast customer base of biotechnology and pharmaceutical companies.

Incyte, which sells genomic technologies, includes among its products LifeSeq Gold, a database of transcribed genes. The database provides a view of the entire human genome by integrating expressed tag sequence and full-length gene sequence information, mapping data and public genomic sequence information.

The agreement gives each company access to the other¿s database on terms usually made available to other subscribers.

LexVision is a database containing phenotypic information derived from Lexicon¿s gene knockout platform related to diseases like cancer, cardiovascular disease, immune disorders, neurological disease, diabetes and obesity.

Incyte in December paid $77 million in cash and equity for all outstanding stock of Proteome Inc., a privately held company with a prestigious lineup of customers for its proteomics databases. (See BioWorld Today, Dec. 22, 2000.)

Earlier this month, Lexicon spent $32 million in stock to buy Coelacanth Corp., a privately held company in Princeton, N.J. Coelacanth¿s proprietary technology, ClickChem, is used to create sets of building blocks used for the production of drug-like compound sets designed to shorten lead discovery and lead optimization time for drug development. (See BioWorld Today, June 15, 2001.)

Incyte¿s stock (NASDAQ:INCY) closed Thursday at $21.90, up $1.46. Lexicon¿s stock (NASDAQ:LEXG) closed at $10.50, up 26 cents.