PARIS — The agreement concluded between the French gene therapy company Transgène SA and Schering-Plough Corp. in early February was the first ever technology transfer deal concluded by Strasbourg-based Transgène.

It constitutes an important milestone for the company, which was only created in 1992, and as its chief scientific officer, Michael Courtney, told BioWorld International, the deal is a "major validation of Transgène's gene delivery technology."

The agreement gives Schering-Plough rights to existing and future applications of adenoviral gene delivery systems developed by Transgène. In the first instance, the U.S. pharmaceutical company is paying $8 million up-front for an exclusive license to utilize Transgène adenoviral systems for delivering the p53 tumor-suppressor gene.

The deal also calls for Schering-Plough to pay a further $1.25 million in research and development funding during the first 15 months. Beyond that, however, the U.S. company has options for licensing Transgène technology for delivering five other unnamed genes, which can be exercised over a period of up to five years. Should Schering-Plough exercise all those options, its payments to Transgène would total some $88 million.

Transgene Aims To Develop Own Therapies

It is part of Transgène's strategy to negotiate collaboration agreements with large pharmaceutical companies for the exploitation of its discoveries, although it also intends to market some itself. Other deals are being negotiated, which could bring more invaluable injections of cash and help Transgène avert the need to raise additional loan finance or equity capital.

Transgène remains a private company controlled by a small group of French shareholders, and is still living off the proceeds of a $48-million private share placement arranged in 1994. It still had some $20 million to $25 million left at the end of 1997, which would be sufficient to finance the company's research and development for 12 to 18 months.

The company's president and CEO Bernard Gilly told BioWorld International the company intended to raise additional funds and was looking at a variety of options, including the stock market and private placements. But he made it clear its funding needs would depend on possible alliances with big pharmaceutical companies.

Such deals could help Transgène move into profit before the first products derived from its technology arrive on the market, which will not be before 2000 or 2001, according to Gilly.

The company is developing a variety of gene therapies for cancer based on four novel delivery systems using retroviral, vaccinia viral and synthetic vectors as well as the adenoviral one.

In addition, it has three other gene therapy programs underway for cystic fibrosis, AIDS and muscular dystrophy. It has two Phase II clinical trials of in vivo cancer therapies underway, one involving the delivery of the cytokine interleukin-2 (IL-2) using the vaccinia virus MUC1-IL-2 in the treatment of advanced metastatic breast cancer, and one involving a non-specific immunotherapy using monkey vero cells to deliver IL-2. The company also is testing another intratumoral delivery system using the adenoviral-IL-2 and Phase I/II clinical trials are planned this year.

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