By Kim Coghill

Washington Editor

Toni Schuh, president and CEO of Sequenom Inc., described the collaboration agreement between Sequenom and Morphochem AG as a ¿compelling marriage¿ between population genetics and chemical genomics.

The companies on Thursday said they entered an agreement likely to last two to three years that will focus on discovery and development of next-generation therapeutics for the treatment of Type II diabetes mellitus and cancer. Morphochem AG, of Munich, Germany, will use its chemical genomics approach to validate disease gene targets discovered by Sequenom, and together the companies will develop drug candidates for these targets.

Schuh said the combined technologies will serve as a solution for pharmaceutical companies interested in developing breakthrough medications using gene-based targets.

¿When you are developing drug targets using genomics tools, by definition your targets are pretty specific and that means that the requirements toward the chemical structure of compounds that should interact with the targets are pretty high,¿ Schuh said. ¿And Morphochem¿s chemistry approach in that is one of the leading approaches, if not the leading approach, in the industry.¿

Regarding financial aspects of the deal, Schuh said each company will cover its own research costs and the two will equally share any results of the collaboration.

The collaboration will use Sequenom¿s disease gene discovery program to rapidly screen all genes contained in the human genome. The success of this program is based on the performance of Sequenom¿s MassARRAY technology, which reveals the markers and genes associated with a given disease. Sequenom has identified and prioritized more than 30 candidate genes for diseases that the company said have a broad impact on health.

Morphochem¿s chemical genomics platform creates new and diverse drug compounds by integrating several technologies, including chemistry, biology and informatics. Based on the technology, Morphochem is able to study complete biochemical pathways in cellular systems, validate novel targets from genomics efforts and discover efficacious molecules in one experiment. As a result, molecules are optimized in a rapid, holistic way, giving rise to large numbers of clinical candidates with fewer side effects and less toxicity, a statement by the company said.

Sequenom¿s stock (NASDAQ:SQNM) Thursday closed at $14.59, up 8 cents.