Ecogen Inc. of Langhorne, Pa., announced Monday a three-year,$9.5 million research agreement with Italy's 3A S.r.l. todevelop biofungicide products.

According to John Davies, Ecogen's chairman and chiefexecutive, Ecogen will not give up any of its product rights andwill not have to pay any royalties to 3A. Ecogen is essentiallybeing paid to carry out its research at a state-of-the-artfacility in Umbria, Italy, Davies said.

"3A let us design our own lab space and equipmentspecifications for the facility," said Davies. In return, Ecogenmade a commitment to utilize 3A's new facility.

The deal with 3A will help Ecogen develop products that it hasaccrued through its acquisition of three companies over thepast year: FRM Agricultural Sciences Partnership of Israel,Bioenterprises Pty Ltd. of Australia, and Scentry Inc. ofBillings, Mont.

A substantial portion of the research for Ecogen's threeproducts - formulation and fermentation processes for acontrol for powdery mildew on plants, for post harvest rot onfruits and vegetables, and nematode development - will beconducted at 3A.

"We expect to see a post harvest rot preventative product onthe market both in Europe and the U.S. by early 1994," Daviessaid.

Davies said Ecogen's relationship with 3A will also help itthrough the European regulatory process. 3A's scientificadvisory board has already given Ecogen valuable input, he said.

The deal, although sizable by ag-bio standards, is not Ecogen'slargest. In January 1991 the company signed a $12.7 millionmarketing deal with Paris-based Roussel-UCLAF for Ecogen'sBt bioinsecticide.

Ecogen's stock (NASDAQ:EECN) dropped 13 cents a share onMonday, to close at $7.38.

-- Michelle Slade Associate Editor

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