By Frances Bishopp

Texas Biotechnology Corp. and SmithKline Beecham plc have entered into an agreement potentially worth more than $75 million, if future indications are pursued, to market and codevelop Texas Biotechnology's heparin substitute, Novastan, in the U.S. and Canada.

The initial focus of the collaboration is the commercialization of Novastan as anticoagulant therapy in patients with heparin-induced thrombocytopenia (HIT).

The agreement provides for an up-front payment of $11.5 million from SmithKline, of London, to Texas Biotechnology, of Houston, which included the purchase of $3 million in equity, $1 million of which was paid immediately.

David McWilliams, president and CEO of Texas Biotechnology, told BioWorld Today that $2 million of the equity amount would be based on a "put option," which could be exercised by Texas Biotechnology over the next year. "We could ask SmithKline to buy $2 million of equity at an average price to be determined around the date on which we make the put," McWilliams said.

Also, the agreement calls for an additional $20 million in milestone payments. SmithKline will pay approximately 60 percent of any clinical expenses related to future regulatory filings, 100 percent of any Phase IV expenses and all sales and marketing costs, McWilliams said.

HIT is an immune-mediated disease caused by the development of antibodies to a complex of heparin and platelet factor 4 — in essence, an allergic reaction to heparin.

Patients who develop HIT continue to need anticoagulant therapy, but must be removed from heparin since its continued use can lead to thrombotic complications, which in turn can lead to amputation or death.

Depending on susceptibility and the amount of heparin exposure, HIT is developed in approximately 5 percent (275,000 patients) of the heparin-treated patients.

Texas Biotechnology began a new drug application (NDA) for Novastan as an alternative to heparin in patients with HIT in June 1997, when the chemistry manufacturing and control sections were submitted, McWilliams said. The remaining parts of the NDA will be submitted this month, he said.

"We're hoping Novastan will be given a fast-track, priority review," McWilliams said, "based on the life-threatening nature of HIT."

Patients with HIT must be taken off heparin, McWilliams said. Certain patients with HIT will resolve themselves, but others will not and currently there is no alternative treatment.

The second indication for Novastan involves using the drug in combination with streptokinase or tissue plasminogen activator (tPA), both clot-dissolving agents often combined with heparin to treat heart attacks, for acute myocardial infarction.

The company has finished a Phase II clinical trial of 1,200 patients for this indication, McWilliams said. Texas Biotechnology's Novastan development partner, Synthelabo SA, of Montrouge, France, has completed another 1,200-patient Phase II trial of Novastan for the same indication. Results of both trials will be released in September of this year, McWilliams said.

Novastan (agatroban) is a small molecule inhibitor of thrombin, an enzyme involved in blood clotting. Texas Biotechnology licensed U.S. and Canadian rights to the drug, which is derived from an amino acid called L-arginine, from Genentech Inc., of South San Francisco.

Synthelabo has European, African and Middle Eastern marketing rights. Mitsubishi Chemical Corp., of Tokyo, markets Novastan in Japan for chronic arterial occlusions.

Founded in 1989, Texas Biotechnology focuses on computer-aided small molecule drug design. All drug-intervention targets are in the vascular system, McWilliams said. Once a target is identified, he continued, "the company has a fairly sophisticated computer-aided drug design system than enables us to go from the targets to identification of small molecules that will interfere with the target at a specific site."

In addition to Novastan, Texas Biotechnology has completed Phase I studies of endothelin-A receptor antagonist for congestive heart failure and another product, selectin antagonist (a non-steroidal vascular anti-inflammatory) for asthma.

The company expects to begin Phase IIa trials for these compounds in the second half of 1997, McWilliams said.

Texas Biotechnology's cash on hand with the addition of the SmithKline funds is approximately $19 million, McWilliams said.

Texas Biotechnology's stock (AMEX:TXB) closed Wednesday at $6, up $0.062. *