By Mary Welch

Selective Genetics Inc. signed its first collaboration, a deal worth up to $32 million with Biomet Inc., to use its gene therapy technology for orthopedic indications.

¿One of the things that¿s interesting about this deal is that it points out how intertwined the pharmaceutical and device industries are becoming,¿ said Robert Abbott, Selective¿s CEO. ¿We¿re right at the interface. Pharmacological devices is what I call it.¿

Under the terms of the agreement, Selective received a $5 million up-front equity investment from Biomet, which represents about 10 percent of the San Diego company. In addition, Biomet, of Warsaw, Ind., will fund research and development for the next 10 years and has an option to make a similar equity investment at a later date. Privately held Selective also would receive a royalty on net sales of products.

In return, Biomet, one of the country¿s largest orthopedic device companies, received a worldwide exclusive license to market all covered products. Selective Genetics retained certain manufacturing rights as well as full rights to a small number of musculoskeletal indications. These additional indications could become part of the alliance at a future date.

Abbott granted that 10 years is a long contract.

¿It is unusually long, yes,¿ he said. ¿The reason in this instance is that there are quite a few specific products that we would like to develop. Normally there are two or three products covered [in a deal]. It also is a reflection of the device industry, where they tend to develop more products. These products tend not to rack up a billion dollars in sales as many drugs do. Each device product tends to have smaller sales.¿

The two companies have identified about six products they want to develop, mostly in the muscular-skeletal area. Although most are bone-related, some involve tendon and ligament repair as well as meniscus repair. Those in the bone area include indications for hip fractures, spinal fusion and complex fracture repair. Of those, the hip fractures and spinal fusion are the largest markets. Some 300,000 Americans, mostly elderly, suffer from hip fractures each year.

Selective Resulted From Matrigen-Prizm Merger

Selective Genetics was founded last year as a result of the merger between Matrigen Inc., of Ann Arbor, Mich., and Prizm Pharmaceuticals Inc., of San Diego. The company combined Matrigen¿s Gene Activated Matrix technology and Prizm¿s fibroblast growth factor gene targeting technology, called Directin. (See BioWorld Today, May 7, 1998, p.1.)

Matrigen took a gene and immobilized it in a matrix that could then be applied to an injury site. The genes in the matrix are held in the wound until activated repair cells come to the genes. Up to that point, virtually all gene therapies were administered in a liquid form, such as naked DNA, viral vectors or liposomes, making them impractical to use in acute injury situations.

To promote tissue and cell regeneration, Selective also uses fibroblast growth factor (FGF-2) linked to plasmid DNA or to viral vectors as targeting agents, a technology developed by Prizm. FGF-2 interacts with its receptors with extremely high affinity. This binding between FGF-2 and its receptor outperforms monoclonal antibody binding by a hundredfold. These receptors are found almost exclusively on tissue repair or malignant cells.

¿Most companies in gene therapy have concentrated in three areas: cancer, inherited diseases and viral infections,¿ Abbott said. ¿But over the last one or two years there has been a rapid shift of attention to tissue repair. People are realizing that gene therapy is the most effective way of delivering growth factors.¿

Selective is ¿working aggressively¿ toward a fourth-quarter timetable for starting human trials in two indications. The first one, for fracture repair in elderly osteoporotic patients, will be part of the new partnership. It involves ¿loading a sponge¿ with DNA for parathyroid hormone, Abbott explained. ¿Parathyroid hormone is principally responsible for the deposition of calcium in bones. The product, a fluffy sponge, is placed at the fracture site where it will serve as a replacement for bone grafts.¿

The second indication, for diabetic ulcers, involves a collagen paste that contains the gene for platelet-derived growth factor.

Although not ready for clinical trials, the company has three other products in its pipeline ¿ for nerve regeneration, therapeutic angiogenesis, and prevention of restenosis. n