Somatix Therapy Corp. and Baxter Healthcare Corp. are teamingup to develop a gene therapy for hemophilia, the companiesannounced Wednesday.

Under the agreement, Baxter acquires worldwide marketingrights to non-autologous cells modified with Somatix's MFGretroviral vector. The two companies will collaborate inresearch and manufacturing at Somatix.

Baxter will conduct clinical trials, market the productworldwide and provide Somatix with certain milestonepayments and sales royalties. Baxter also will get the right offirst negotiations for certain other approaches Somatix isdeveloping for treatment of hemophilia A and B.

Mark Bagnall, Somatix's chief financial officer, told BioWorldthat the agreement establishes a long-term relationship withBaxter. He said Somatix plans to use Baxter's device with itsvectors to deliver various proteins to the vascular system.

Somatix (NASDAQ:SOMA) will use its retroviral vector MFG toinsert the factor VIII gene into a cell line, thus causing it tooverproduce the blood clotting protein factor VIII. Thecompany also will develop a cell line for factor IX (deficiency offactor VIII causes hemophilia A and deficiency of factor IXcauses hemophilia B). Baxter will then incorporate the modifiedcell lines into its membrane device for insertion into patients.

Under its hemophilia program Somatix has been developinggene therapy using modified autologous cells. In rat and micestudies, the Alameda, Calif., company has taken an animal'sown cells, modified them to contain the factor VIII gene andreinserted them into the animal.

Bagnall said the studies have shown sustained production offactor IX for more than a year and therapeutic levels of factorVIII within two to three weeks. Somatix will continue to workwith this program, which Bagnall said may be a secondgeneration technology.

Explaining the advantages of using the device, WilliamJohnston, Baxter's vice president and general manager, said,"(It) allows us to use allogeneic tissue."

He said the cell line "can be very highly characterized" with thedevice, more so than with autologous therapy.

In addition, the use of a universal cell line that can be used forall patients will reduce operating costs compared withexpensive autologous blood donations.

The device also provides a safety control. Since the cells arecontained within the device, they can be removed if necessary.Also, Johnston said patients will only be exposed to secretedprotein, thus eliminating concerns about potential risks of theretroviral vector.

Baxter Healthcare of Round Lake, Ill., had been pursuing itsown independent program of engineering cells to producefactor VIII, but will now work with Somatix.

Baxter and Somatix each have a strong background in genetherapy and hemophilia research. Baxter markets RecombinateAntihemophilic Factor, a bioengineered factor VIII proteinapproved by FDA in 1992 for treatment of hemophilia. Theproduct was developed under a collaboration with GeneticsInstitute Inc.

A gene therapy product would be an improvement over thisinjectable formulation of factor VIII since it would allowcontinuous delivery of the clotting protein. Johnston said thetypical hemophiliac receives 30 to 50 injections of factor VIIIper year in response to acute bleeding in the joint. Because ofthe cost of the treatment, patients do not receive the drug forminor bleeding.

"The net result is that a middle-aged hemophiliac is somewhatcrippled because of the minor bleeds," Johnston said. With genetherapy, "much of the morbidity of the disease" will beeliminated.

Baxter International's Biotech Group recently formed a genetherapy business unit to consolidate its research anddevelopment activities (see BioWorld, Aug. 25). In addition tohemophilia, Baxter is developing gene therapy for cancer anddiabetes.

Somatix is focused on gene therapy for cancer and Parkinson'sdisease. The company's gene therapy protocol for treatment ofadvanced renal cancer was approved by the National Institutesof Health's Recombinant DNA Advisory Committee in March.The treatment involves vaccinating patients with their owntumor cells that have been genetically modified fo contain thecDNA for the lymphokine granulocyte macrophage-colonystimulating factor (GM-CSF). The vaccine is intended tostimulate the body's immune system to selectively destroycancer cells.

Somatix is just beginning primate studies of a gene therapy totreat Parkinson's disease. It consists of using skin fibroblastsmodified to contain the gene for tyrosine hydroxylase, anenzyme necessary for dopamine production. The modifiedfibroblast cells are to be inserted into an area in the patient'sbrain, resulting in local production and delivery of dopamine(Parkinson's disease is caused by a reduction in dopaminelevels).

Somatix reported end-of-the-year losses on June 30 of $15.7million, or $1.19 per share, compared with losses of $43.2million, or $4.43 a share, in the year-ago period. The companyhad cash and marketable securities of $11.7 million at the endof the 1993 quarter, compared with $22 million in the prior-year quarter. The company's stock closed at $8.25 a share onWednesday, up 25 cents.

-- Brenda Sandburg News Editor

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