By Matthew Willett

In a further move toward narrowing its focus, Aventis Pharma will spin off its Gencell gene therapy division, forming a separate company at the same time it restructures its p53 gene therapy collaboration with Introgen Therapeutics Inc.

Introgen will get all manufacturing and commercial rights to the p53 gene therapy product, a $20 million equity investment from Aventis and a 5 percent stake in Aventis' spin-off. Introgen officials called it a boon.

"I think both parties recognized, and this restructuring is testament to the idea, that the development of gene therapies, the clinical development of gene therapies, is best handled by small, nimble biotech-focused companies," James Merritt, Introgen's vice president of clinical development, told BioWorld Today.

Aventis Pharma, a division of Aventis SA, of Frankfurt, Germany, will make the $20 million investment in nonvoting preferred shares of Introgen as a part of the restructuring, and Aventis will maintain a minority interest in Gencell, which will be dedicated to discovery and development of gene therapies.

The equity investment, which likely will be transferred to Gencell, Merritt said, will increase Aventis' stake in Introgen from 18 percent to about 20 percent.

Introgen, of Austin, Texas, will take the lead role in developing a p53 gene therapy for head and neck cancer. The p53 gene therapy product, INGN 201, is in pivotal Phase III trials.

Merritt said the program will not be delayed despite the shift in control from Aventis to Introgen.

"As of [Tuesday] primary responsibility for all clinical programs reverts to Introgen," he said. "We don't anticipate any change in the clinical studies; we'll simply prosecute those on our own behalf, and we don't anticipate any delay going forward. The current timeline provided us by our Aventis collaborators under their prosecution of Phase III testing is that both trials would terminate by the end of 2003, and we anticipate filing immediately thereafter, in early 2004."

The Introgen-Aventis collaboration dates to October 1994. Aventis' $20 million equity investment is for Introgen preferred shares, which are convertible to common shares at a premium to the market price.

In return, Introgen will give rights to an angiogenic compound held by its European subsidiary, Gendux Inc., to Aventis. That program, Merritt said, fits with Gencell's stated focus on cardiovascular disease gene therapy.

The p53 product, on the other hand, is one Introgen is happy to pursue development of, since the gene's suppression or mutation is wide ranging in human cancers.

"It's the best understood and the most researched cancer-related gene," he said. "It's implicated in more than 50 percent of all human cancers regardless of body location or tissue type. Introgen uses p53 as a drug. We're not in the business of repairing faulty genes. We're in the business of causing the expression of pharmacological levels of functional p53 in cancer tissue. That revives the faulty pathways and causes the death of the cancer tissue."

Introgen's stock (NASDAQ:INGN) closed Tuesday at $3.562, down 25 cents. n