PARIS - Despite a 44 percent increase in R&D spending - to FFr48.7 million in the second quarter of 1998 from FFr33.9 million in the same three months a year ago - Genset SA trimmed its net quarterly loss to FFr23.2 million from FFr24.9 million.
The improvement was more significant relative to the first quarter of 1998, when the Paris-based genomics company posted a net loss of FFr27.8 million.
This outcome followed an increase in Genset's revenues, which more than doubled to FFr38 million in the second quarter of this year from FFr16.7 million during the same period of 1997. R&D revenues amounted to FFr29.5 million, an increase of nearly 270 percent relative to the FFr8.6 million in the second quarter of 1997. Quarterly sales of oligonucleotides were virtually unchanged at FFr8.5 million, compared with FFr8.6 million last year.
In the first half of 1998, Genset's R&D revenues amounted to FFr60.9 million and its total revenues to FFr76.9 million. R&D spending reached FFr102.5 million and net loss came out at FFr51 million.
As at June 30, Genset reported financial reserves (of cash, cash equivalents and short-term investments) totaling FFr392.9 million, compared with FFr461.7 million at the end of 1997.
Genset said the increase in its R&D outlays this year has been due, among other things, to costs associated with generating the biallelic marker (single nucleotide polymorphism) map of the human genome as part of continued expansion of its gene discovery and pharmacogenomics programs.
Gene Identified For Prostate Cancer
In the second quarter of this year Genset received not only R&D payments from the companies with which it has research collaborations - including Synthelabo SA, of Montrouge, France; Johnson & Johnson, of New Brunswick, N.J.; Genetics Institute Inc., of Cambridge, Mass.; and Abbott Laboratories, of Abbott Park, Ill. - but also a milestone payment from Synthelabo following Genset's discovery and patenting of a gene associated with prostate cancer. (See BioWorld International, May 6, 1998, p. 3.)
The company has not disclosed the size of that payment, but Chief Financial Officer Deborah Smeltzer told BioWorld International it was “significant“ relative to the regular quarterly R&D funding it receives from its partners.
She added Genset expects to sign three more collaboration agreements in the second half of this year, two in the field of pharmacogenomics and one for a new disease gene program. The latter will be in one of the four pathological fields, apart from cancer, targeted by Genset's gene discovery programs - namely cardiovascular diseases, osteoporosis, obesity and central nervous system disorders.
The prostate cancer gene was discovered less than two years after Genset and Synthelabo embarked on their joint research program into the genetics of the disease.
Identification of the gene was described by Genset's CEO, Pascal Brandys, as “a landmark achievement in our gene discovery program,“ and one that “clearly underscores the value of Genset's approach combining high-resolution mapping and high-throughput sequencing with genome-wide association studies.“
Genset employs more than 400 people worldwide, including 260 engaged directly in genomics research and development. *