By Mary Welch

The Althexis Co. signed a three-year, $14.4 million deal with a Croatian firm to develop and commercialize broad spectrum antibiotics, using structure-based drug design (SBDD) technologies.

Pliva d.d., of Zagreb, Croatia, will pay Althexis, of Waltham, Mass., up to $14.4 million in research funding and milestone payments. Additional revenues to both companies may result from certain exclusive marketing rights retained by each under the collaboration agreement.

¿It¿s a very good match,¿ said Manuel Navia, president of Althexis. ¿They are a very product-focused company, as are we. To us, the challenge is to push the economies of drug discovery, and see how effectively we can take a concept and convert it into a drug.¿

Pliva, the largest pharmaceutical company in the areas of central and eastern Europe, receives worldwide rights to market any drugs that result from two specified research projects, except in Japan, South Korea, and Taiwan, where Althexis reserves those rights. The partners will each retain non-exclusive rights in China.

The companies will pool and share their data, including preclinical and clinical results, in an effort to develop two antibacterial drugs.

Founded less than a year ago, Althexis is focused on SBDD, an approach to drug discovery and development based on the definition of precise atomic-level information about therapeutic targets, interpreting the chemical interaction between the targets and drug candidates.

¿Essentially, SBDD allows you to filter out compounds with far fewer resources, such as people and chemicals, than in the traditional trial-and-error method of screening chemical compounds for specific qualities,¿ Navia said. ¿You get to the same endpoint [as traditional screening], but there are economies associated with our way. In addition, it¿s more comprehensive. SBDD will yield information even if the test is negative ¿ and the test still moves forward.¿

SBDD is readily applied to antibiotic drug discovery, because anti-bacterial therapeutic target enzymes already have been researched extensively, exposing clear targets to inactivate the reproduction of bacteria.

Althexis¿ founders have been working with SBDD for more than 25 years. Navia established a structural biology laboratory at Merck & Co. Inc., of Whitehouse Station, N.J. This program evolved into the practice of SBDD and the development of Trusopt, a glaucoma drug. Most recently, Navia was senior vice president and senior scientist at Vertex Pharmaceuticals Inc., of Cambridge, Mass.

Patrick Connelly, vice president and chief scientific officer, was a founding scientist and senior scientific staff member at Vertex, where he initiated and led the first structural thermodynamics drug design group in the pharmaceutical industry, establishing a new brand of SBDD.

¿Patrick had left Vertex to start teaching in a secondary school,¿ Navia said. ¿I was getting the seven-year itch¿ at Vertex, and wanted to do something entrepreneurial. So, we got together.¿

The company dipped its toe into the venture capital market, and found it ¿not favorable,¿ he said. ¿They didn¿t understand what we were doing and how we intended to be a product-focused company.¿ An initial amount of seed capital came from Mass Ventures LLC, of Atlanta, and Dailey Partners, of Southport, Conn.

Nine months ago, Navia and Wolfgang Schoenfeld, director of anti-infective research at Pliva, attended a professional conference in Atlanta. ¿We were at a Braves baseball game,¿ Navia said. ¿You know baseball. Nothing happens. So, we had a lot of time to talk, and we basically put the collaboration together at the ball game.¿

Pliva, which has been listed on the London Stock Exchange since 1996, has a long history of antibiotic development. Its biggest success to date was the invention and development of azithromycin, which was licensed to Pfizer Inc., of New York, for worldwide marketing except in countries where Pliva retained the rights. Azithromycin (Zithromax, Sumamed) posted U.S. sales of $1 billion in 1998.

The companies decided to focus on antibiotics for several reasons. The first was that Navia believes there is a ¿desperate clinical need¿ for new antibiotics, especially since bacteria is becoming resistant to so many antibiotics currently on the market.

¿There is a looming public-health problem, and the infectious-disease doctors tend to be receptive to new products that operate by a different mechanism,¿ Navia said. ¿Plus, we felt the regulatory climate will be more favorable in the future than it is now, in terms of broad-spectrum antibiotics that address public-health issues. While the regulation authorities will certainly do their jobs, we feel they¿ll be receptive and look at results and filings expeditiously.¿

Developing antibiotics should allow for efficiency, Navia said.

¿Clinical trials for antibiotics are about as well-defined as you can get,¿ he said. ¿Outcomes are very clear and the clinical trials are structured so there are no surprises.¿

Althexis, which will soon have a staff of about 14, believes its approach will produce anti-infective agents for Pliva¿s pipeline.

¿If you do the calculations of how much it costs to develop a drug, especially one that takes years to bring to market, you realize that you have to develop a drug that yields astronomical sales in order to get your investment back,¿ Navia said. n

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