VANCOUVER, British Columbia - Japan Tobacco, of Osaka, Japan, is opening an office in London in January to source technologies and look for partnering opportunities in Europe.

The operation is intended to mirror Japan Tobacco's U.S subsidiary, Akros Pharma Inc., which in the past 10 years has established nine collaborations with U.S biotechnology companies, more than any other Japanese pharmaceutical company.

The European operation, as yet unnamed, will be run by Keith Crowshaw, currently vice president of Akros, based in San Mateo, Calif. He told the conference, "The aim is to interrelate with the European biotechnology industry, and with European universities, to look for new research opportunities in Europe."

Japan Tobacco entered the pharmaceutical industry about 15 years ago, in a bid to diversify out of cigarettes. "As a recent entry to the pharmaceutical market in Japan, we have used collaboration to build a franchise," he said. "We needed to jump-start, so it was natural to think early on about working with biotechnology companies."

Japan Tobacco's first U.S. alliance with Agouron Pharmaceuticals Inc. to work on HIV protease inhibitors was very successful, leading to the registration of the HIV treatment Viracept. The company also has deals with Abgenix Inc., Cell Genesys Inc., Corixa Corp., Chiron Corp. and Tularik Inc., among others.

"Japan Tobacco is very proactive in looking for partners," Crowshaw said. "We make a short list of companies we want to work with and approach them."

The new company in Europe will source and assess technologies and make recommendations. "All investment decisions and all agreements are made by the head office in Osaka," Crowshaw said. "The London office will then manage any alliances. Japan Tobacco has a policy of sending some of its own scientists to work with the collaboration partner."

To date, most Japanese pharmaceutical companies have been interested in partnering late-stage compounds.

Crowshaw said, "We are interested in technologies with potential, rather than in compounds per se. We want to get into novel areas of drug discovery." Typically, the U.S deals to date have begun as early research agreements, which have been expanded if successful. For example, the initial agreement with Tularik was to work on regulation of leptin expression in obesity. Six months ago it was extended into a separate operation with a brief to look for drug targets in metabolic diseases.

However, Japan Tobacco is interested only in small molecules (although its collaboration with Abgenix is for human monoclonal antibodies) and it has no interest in traditional approaches to antibiotics and cancer therapeutics.

Japan Tobacco's alliances in the U.S. are reaching clinical development stages. As a result, the company is closing the office in San Mateo, and moving to Princeton, N.J., to set up an expanded operation to monitor clinical trials. "With the harmonization of regulatory requirements we expect to do trials in the U.S. and Europe, and then do small bridging studies in Japan," Crowshaw said.