OTTAWA, Ontario - Montreal-based Paladin Labs Inc. has paid Neurocrine Biosciences Inc. about US$2 million for the exclusive worldwide rights to Neurocrine's neuro-steroid program as well as for its Canadian affiliate, Neuroscience Pharma Inc.

Jonathan Goodman, president & CEO of Paladin, said the transaction, which is subject to Canadian regulatory approval, fits in with the company's mandate to acquire and in-license late-stage pharmaceuticals.

"During the year, we successfully secured the rights to over 15 new compounds in the areas of urology, dermatology and palliative care and our aim now is to broaden both these product lines as well as venture into new therapeutic areas," Goodman said. "In doing so, we hope to continue to remain one of the most profitable publicly traded pharmaceutical companies in Canada."

Paladin shares trade on the Canadian Venture Exchange under the symbol PLB. In November, the company received conditional approval to trade its shares on the Toronto Stock Exchange.

The agreement with Neurocrine will provide Paladin with all preclinical and clinical data as well as technology and know-how for the development of neurosteroids for human therapeutic indications. Neurocrine will receive royalties on all future worldwide sales.

Neuroscience Pharma was formed in 1996 to conduct R&D on the use of DHEA (dehydroepiandrosterone), and its metabolite, DHEA-S, in the treatment of memory deficits associated with Alzheimer's disease. DHEA and DHEA-S levels peak before age 20 and then decrease progressively with age. Restoration of DHEA and DHEA-S levels to those seen in younger individuals has been studied to enhance mood, energy, sense of well-being, functional capabilities and memory.

Neurocrine's neurosteroid program, which demonstrated safety of DHEA in Alzheimer's patients, will be used as the foundation to study more broadly the effects of DHEA restoration in the elderly.

Several outside preclinical and clinical studies have demonstrated that DHEA exhibits a wide range of effects in the central nervous system. Scientific literature also shows evidence in preclinical and clinical trials that DHEA may protect neurons from death by increasing growth factor levels in the brain, such as insulin-like growth factor-1, which is known to have neuroprotective activity. DHEA also appears to modulate several cytokines involved in inflammation, which are believed to be involved in the pathology of Alzheimer's disease. DHEA levels are reduced in aging and further decreases are seen in Alzheimer's disease. In addition, in preclinical and clinical studies, low levels of DHEA correlate with memory and functional deficits.