By Debbie Strickland

Genome Therapeutics Corp. (GTC) signed two new agreements — a research collaboration and a separate subscription to its genomics database — with partner Schering-Plough Corp., boosting to more than $143 million the big pharma company's total potential payments to the Waltham, Mass.-based biotech firm.

Under the new collaboration agreement, GTC could receive up to $33 million, including research support and milestones, for using genomics to discover and develop new pharmaceutical products to treat fungal infections related to Candida albicans and Aspergillus fumigatus. Additional royalty payments are possible as well if products reach the market.

Under two previous agreements, Schering-Plough agreed to pay up to $43.5 million for joint discovery of anti-infective agents against drug-resistant organisms, and up to $67 million for using genomics technology to discover new therapeutics for treating asthma.

In the new program, GTC will employ bioinformatics, high-throughput sequencing and functional genomics to identify and validate genes and associated proteins as drug discovery targets. Schering-Plough receives exclusive access to the genomic information developed in the collaboration related to C. albicans and A. fumigatus.

Schering-Plough has rights to develop therapeutics that evolve from the collaboration, while GTC retains rights to vaccines, diagnostics and plant products.

The worldwide market for antifungals is approximately $3 billion, and the number of immunosuppressed patients — who are especially vulnerable to life-threatening fungal infections, such as those covered in the agreement — is growing.

The drug discovery components of this latest collaboration reflect GTC's efforts to evolve from a genetic sequencer to a provider of functional genomics and drug discovery services to big pharma partners. The company also has launched its own internal drug development program through an antibacterials collaboration with Versicor Inc., a subsidiary of Marlborough, Mass.-based Sepracor Inc.

"The name of the game is to get from genes to screens," said Bernd Seizinger, GTC's executive vice president and chief scientific officer. "Previously, GTC was purely focused on genetic information, but last year we began an aggressive expansion into functional genomics and drug discovery target identification."

GTC's agreement with Astra A.B., of Sodertalje, Sweden, has taken this turn.

"In this alliance, we have provided not only the sequence information for [Helicobacter] pylori, but also have provided functional analysis and drug discovery assay development," said Seizinger. "We've reached the high-throughput drug discovery phase in less than two years."

A Third PathoGenome Subscriber

Under a separate agreement, Schering-Plough became the third subscriber to GTC's PathoGenome Database, launched in May.

Financial terms of that agreement were undisclosed, but existing subscribers — Bayer A.G., of Leverkusen, Germany, and Bristol-Myers Squibb Co., of New York — are paying annual subscription fees in the "low to modest seven digit area." Subscription terms also call for potential milestone payments and royalties.

Designed for use at the client site, the database provides genomic sequences of more than a dozen microbes, including Enterococcus faecium, Enterococcus faecalis, Streptococcus pneumoniae and Staphylococcus epidermidis. Others are undisclosed for competitive reasons.

GTC's stock (NASDAQ:GENE) closed Wednesday at $8.437, up $0.187. *

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