By Brady Huggett

Large Scale Biology Corp. and Biosite Diagnostics Inc. formed a technology alliance to generate antibody and protein target components for protein biochips, a collaboration they said could set them apart from the rest of the proteomics lot.

Large Scale Biology, of Vacaville, Calif., through its wholly owned subsidiary, Large Scale Proteomics Corp., figures to provide 2,000 to 5,000 protein targets from its Human Protein Index and other proteomics programs, as well as expressed proteins produced with its Geneware technology. Biosite will use its high-throughput Omniclonal phage-display technology to generate antibodies to the targets. They plan to make an antibody and target package available to partners.

As proteomics burgeons, the companies saw an opportunity to stand out.

"We view Large Scale as a leader and it is probably one of the most aggressive companies in the proteomics field," said Nadine Padilla, vice president, investor relations at Biosite. "We have a mutual respect for each other and each other's technology. We are going to have to differentiate ourselves in this field as a combined effort. This is an exciting venture for Biosite."

Leigh Anderson, president, CEO and chairman of Large Scale Proteomics, of Gaithersburg, Md., agreed with Padilla's statement of the need to quickly rise above.

"Absolutely," he told BioWorld Today. "We are attempting to cut straight to the chase, which is delivering capability to customers for high-throughput measurement of large numbers of valuable proteins."

Biosite, of San Diego, has technology based on proprietary advances in several scientific and engineering disciplines, including antibody development and engineering, analyte cloning and synthesis, signaling chemistry and microcapillary fluidics. In this protein-biochip agreement, Biosite will provide the technical expertise.

"Biosite has two attributes that we found attractive," Anderson said. "One is phage-display technology. The second is they really know how to make high-sensitivity immunoassays. That combination means that they offer a lot in how these protein chips will work."

The deal is set for three years and could be just the first step, said Padilla.

"We view it as an exploratory venture at this point in time that is aimed at developing the content for antibody arrays, to see how our technologies can be combined," she said. "The next step would be to see if [both companies together] want to take on a platform for antibody arrays, or take on a partner, or do a combination of both. If everyone is happy, the deal is extendable."

The targets Large Scale will provide will be quite broad initially, Anderson said, and the first groups of targets, tissue-specific proteins, will come out of its database. Large Scale will add disease-specificity markers as they figure in its priority list, but the idea is to address a broad scope.

Financial terms were not disclosed, but the deal is broken down as follows: Large Scale and Biosite will share rights and returns. Biosite will obtain certain diagnostic licenses to targets and Large Scale will retain all other target rights, including uses in proteomics, database creation and therapeutics. Biosite will receive antibody development fees, as well as payments for certain products successfully developed. If diagnostic products are successfully developed and commercialized, Large Scale will receive milestone payments and royalties.

"For Biosite, we expect it to contribute in the range of $3 million this year," Padilla said. "But what is more significant is the prospect of near-term targets for diagnostics.

"We are in a growth phase, and this will continue to provide us with revenue to fund the increase in capacity of some of our other activities," she added. "And, of course, there is the possibility of milestones and royalties, but that is further down the road. It is a lucrative opportunity."

Although the deal could benefit both companies in their respective areas of expertise, Anderson said that part of the agreement is superfluous.

"We share between us the protein-chip opportunity," he said. "From our point of view, that is the central part of the deal. We are trying to achieve a real leadership position in the proteomics field, which we believe is going to be huge."

Large Scale Biology's stock (NASADQ:LSBC) gained $1.937, or 15 percent, to close Tuesday at $14.75. Biosite (NASDAQ:BSTE) gained $2.937, or 8.5 percent, to close at $37.50.