Incyte Pharmaceuticals Inc. (AMEX:IPI) and Layton BioScience Inc.have teamed up to develop a high-speed gene sequencing capabilitythat could challenge Human Genome Sciences' claim to leadership inthe field.The two companies have signed an exclusive collaborative agreementthat will allow Incyte to adapt and apply Layton's novel, non-PCR-based RNA amplification technology to prepare cDNA libraries fromrare sources. These sources would include single cells and rare cell andtissue sources such as stem cells and single neurons. Layton'stechnology was licensed from James Eberwine, who developed it atStanford University and the University of Pennsylvania. Incyte saidthis technology will help it meet its goal of sequencing all 100,000expressed human genes as rapidly as possible. This is a goal whichHuman Genome of Rockville, Md., shares; the company recentlyannounced that it had sequenced 45,000 genes a year ahead ofschedule. (See BioWorld, April 11, 1994, p. 1)The agreement with Layton is for two years, said Gary Snabel,president and CEO of Layton, a privately held company based inAtherton, Calif. that focuses on exploring neurological diseases at thesingle-cell level. Snabel noted that Layton will be involved throughlicensing arrangements, marketing, and profits generated through theproduction of cDNA libraries on small cell sources. Layton will alsoserve as a consultant to Incyte.Copy DNA (cDNA) sequencing usually depends on preparing cDNAlibraries by purifying RNA from large numbers of cells. Layton'stechnology will allow Incyte to isolate the messenger RNA from asmall number of cells or a single cell, make a DNA copy of it, andsequence the gene, said Randy Scott, Incyte's vice president ofresearch and development. Scott said this technique amplifies RNA in aquantitative and balanced manner, and avoids the problem of size biasand the introduction of errors. The proprietary amplificationtechnology is the subject of two issued and two pending patents.Asserting that Incyte, of Palo Alto, Calif., and Human Genome havecomparable approaches, Scott said Incyte puts more emphasis ontranscript imaging than Human Genome. "Our excitement is aboutwhich genes are turned on or off in specific cells or in specific diseasestates. It's like looking at a snapshot of what genes are turned on or offin a given cell at a given time. We want to create an enormous databaseof transcript information and work with pharmaceutical partners whowould like access to it."Scott said Incyte's goal is to make its sequencing technology availableto several pharmaceutical companies on a non-exclusive basis insteadof tying itself to one particular partner. "Our near-term strategy is to bea resource for other companies and researchers who would use ourdatabase," he said. "For example, if an academic researcher hasisolated a mouse gene and wants to know if there is an equivalenthuman gene, we could look it up and if we have it, we could send it thenext day.""The key is that our two technologies marry so well together," Snabelsaid. "Layton has the ability to produce libraries from a limited numberof cells or single cells, and Incyte has the large-scale sequencingcapability."

-- Philippa Maister

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