Genome Therapeutics Corp., first to announce sequencingof the Helicobacter pylori genome last December, iscashing in on the achievement by selling Sweden-basedAstra AB exclusive access to the infectiousmicroorganism's genetic data for up to $22 million.

H. pylori bacteria are a cause of peptic ulcers andgastritis. The pathogen also may be linked to stomachcancer. Astra will use the gene sequence information toresearch methods of detecting and fighting the bacteria,which infect the stomachs of hundreds of millions ofpeople worldwide, including nearly half of all Americans.

The Swedish pharmaceutical company already has astrong presence in the market for gastrointestinalmedicines with Losec (sold as Prilosec in the U.S.),which is the second largest selling ulcer drug in theworld.

Fenel Eloi, Genome Therapeutics' chief financial officer,said Astra has committed $11 million to the Waltham,Mass.-based genomics company to cover two and onehalf years of research and development. GenomeTherapeutics will receive more than $8 million in the firstyear. The collaboration covers a total of four years.

Payment of the other $11 million will be based onachieving milestones in developing products, such asdiagnostics, drugs and vaccines, derived from H. pylori'sgenetic profile.

Under terms of the agreement, Astra is paying licensefees for access to the H. pylori gene sequence data base,research funds for Genome Therapeutics' help inunderstanding the biology of the bacterium's genes aswell as the milestone contributions. In addition, GenomeTherapeutics will get royalties on products Astra markets.

Eloi said Astra has purchased exclusive rights to alltherapeutic applications of Genome Therapeutics' H.pylori gene sequence data. Astra's market position ingastrointestinal therapeutics, he added, should ensure anaggressive research effort.

Eloi said his company expects Astra will be the first ofmany pharmaceutical companies to line up for geneticinformation being uncovered by Genome Therapeutics.

Like other genomics companies, such as Human GenomeSciences Inc., of Rockville, Md., and IncytePharmaceuticals Inc., of Palo Alto, Calif., GenomeTherapeutics is identifying genes and their functions in aneffort to sell the information for drug discovery.

In addition to H. pylori, Genome Therapeutics issequencing the genomes of other pathogens as well asdiscovering human genes involved in diseases such asprostate cancer, osteoporosis, manic depression andschizophrenia.

The company uses a multiplex gene sequencingtechnology, licensed from Harvard University inCambridge, Mass., to identify genes. In September 1994,Genome Therapeutics received a $10 million grant fromthe National Center for Human Genome Research toadvance the technology, particularly the sequencingspeed.

The H. pylori genome contains only 2,000 genes,compared with an estimated 100,000 in humans, and wassequenced by Genome Therapeutics in five months.

The company's researchers said identification of thebacterium's genome not only will help develop drugs tofight the infection, but also may shed more light on theoperation of the human immune system and how otherinfections work.

For example, because H. pylori is a persistent infection inpeople, the bacteria's genes may have derived a methodof overcoming attacks from human immune systems.

Genome Therapeutics (NASDAQ:GENE) closed Fridayat $8, up 25 cents. n

-- Charles Craig

(c) 1997 American Health Consultants. All rights reserved.