By Lisa Seachrist

Washington Editor

WASHINGTON — Genzyme Molecular Oncology (GMO), a division of Genzyme Corp., has signed a genomics collaboration agreement allowing U.K.-based Hexagen plc to use GMO's proprietary Serial Analysis of Gene Expression (SAGE) technology for Hexagen's Type II diabetes gene discovery program.

The agreement represents the fourth collaboration based upon GMO's SAGE technology since the company began to offer it to pharmaceutical and genomics companies in the second half of 1997.

"We are very pleased with the progress we have made to date," said Susan Primrose, director of market planning for the Framingham, Mass.-based company. "The fact that several companies have looked at this technology and decided that it offers them a unique way to compare tissues and gene expression really validates the technology."

Under terms of the agreement, Hexagen, of Cambridge, U.K., will pay an undisclosed user fee to have GMO perform SAGE analysis to discover susceptibility genes for diabetes and provide gene expression information for genes associated with Type II diabetes.

The first phase of the collaboration is expected to last several months, after which Hexagen plans to expand the agreement and license SAGE for in-house use from GMO for multiple applications should the method prove useful in expanding its diabetes candidate gene library.

SAGE is a method of quantitating messenger RNA levels in a cell. As a result, it is a high-efficiency method of simultaneously detecting and measuring all of the genes expressed in a cell at a given time.

Developed by Bert Vogelstein and Ken Kinzler of Johns Hopkins University, in Baltimore, the technology was licensed in 1995 to Allendale, N.J.-based PharmaGenics, which was purchased by Genzyme, of Cambridge, Mass., in February 1997.

The differential gene expression technology can be used to identify disease-related genes — such as Type II diabetes genes — analyze the effects of drugs on tissues and provide molecular insight into disease pathways.

In addition to SAGE customers, GMO has been successfully attracting collaborators for their gene therapy and small molecule programs as well as signing an $8 million small molecule deal with Merck & Co., of Whitehouse Station, N.J., in February and an $80 million gene delivery deal with Schering-Plough, of Madison, N.J., in January. (See BioWorld Today, Jan. 6, 1998, p. 1, and Feb. 4, 1998, p. 1.)

As a division of Genzyme, GMO will have its own tracking stock. In April 1997, the company filed with the Securities and Exchange Commission a registration statement for an IPO totaling $35 million, but the offering has yet to be priced.

"We have been working very hard to increase the strength of the company with these collaborations," said Primrose. "Completing the IPO is one of the projects we are actively pursuing, but we are evaluating market conditions. However, I don't know when it will occur." *