By Randall Osborne

Gene Logic Inc. said its first partner, Procter & Gamble Co. (P&G), is expanding their potential $75 million deal to a degree that will double the annual revenues to Gene Logic.

"The $75 million was based on three indications of roughly $25 million each," said Stephen Push, spokesman for Gaithersburg, Md.-based Gene Logic. "This is the second indication."

Specific terms were not disclosed, but Push said the general ranges for agreements related to Gene Logic's READS gene expression technology are $3 million to $6 million in guaranteed access fees per year; and $1.5 million to $2.5 million in milestone payments per year, assuming Gene Logic hits its objective, which is 10 new drug targets per year, starting with the second year.

Royalties on resulting products typically are 2 percent to 4 percent for small molecules, and 6 percent to 8 percent for proteins. The percentages increase with revenues.

Gene Logic last year agreed to discover genetic targets for drug development in three indications for P&G. Heart failure was the first indication. The others were not disclosed. (See BioWorld Today, June 16, 1997, p. 1.)

"The second indication [which is the subject of the expansion] is osteoporosis," Push said. Gene Logic and P&G also have changed the structure of the deal, making it no longer exclusive. Under the new terms, P&G can work with Gene Logic on any indication, and Gene Logic may work with other partners on specific indications.

Gene Logic, which has signed more than a half-dozen alliances since the P&G deal, has been using READS to build a database for P&G of genes differentially expressed between normal heart tissue and heart tissue from patients with heart failure. The wider deal means the database will be enlarged to include osteoporosis genes.

Push said Gene Logic's stock has rallied this month in several surges.

"We've been on the road almost every week for the last four months," he said. Company officials covered the U.S. and visited Europe twice.

"The stock was cheap and we made good presentations," he added. "At least one major U.S. institution is taking a new position in the stock, and several others have increased their positions during that period."

Gene Logic's shares (NASDAQ:GLGC) closed Monday at $6.375, up $0.25. *

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