Gilead Sciences Inc. and Glaxo Inc. said Thursday they areexpanding a 2-year-old exclusive collaboration into codeblocker technology beyond the initial target of cancertherapeutics.

"We believe that our expanded joint effort will prove to be aformidable force in cracking the technological challenges ofantisense and triplex," said Richard B. Sykes, chairman andchief executive of Glaxo Group Research in Research Triangle,N.C., a unit of Glaxo Holding plc of London. This effort shouldlead to the design of a broad range of new therapies, he said.

Under the expanded agreement, the two companies will overthe next three years explore code blocker applications fortreating viruses and other undisclosed conditions, LindaFitzpatrick, Gilead's director of investor relations, saidThursday.

With the new agreement, Glaxo is committed to funding theremaining $9.6 million of the 1990 agreement. Glaxo agreed in1990 to invest $20 million over five years to support Gilead'sresearch, including $8 million to acquire a 6 percent equitystake in Gilead.

Code blockers are nucleotide-based therapeutics that blockdiseases by interfering at the DNA and RNA level. To developpotential cancer therapeutics, researchers are targetingantisense compounds at gene sequences that occur only incancer-related oncogenes, which encode the genes for tumor-associated proteins.

Gilead's stock (NASDAQ:GILD) closed Thursday at $10.75, up 50cents. The stock went public in January at $15 a share.

During the next three years, Glaxo and Gilead will share anycommercial applications to the code blocker technology. After1995, both companies will share rights to any blockercompounds for all diseases. Glaxo and Gilead have also agreedto work exclusively with each other on code blockers,Fitzpatrick said.

When it was signed two years ago, the Glaxo-Gilead deal wasconsidered the first collaborative foray by a majorpharmaceutical company into antisense technology. Glaxo hassince established an in-house research effort in code blockers, agroup that now collaborates directly with Gilead researchers.

Gilead has had success in moving blocker compounds throughthe cell membrane, Fitzpatrick said. "The next challenge is to besure that the penetration is potent and specific."

Independent of Glaxo, Gilead is developing small moleculeproducts based on nucleotide analogs that work inside a cell tointerfere with the proteins necessary for replication. Its mostadvanced compound, GS 504, entered Phase I/II clinical trialsin early May as a potential treatment of CMV retinitis, a causeof blindness in AIDS patients. Gilead researchers are alsodeveloping aptamer compounds.

-- Ray Potter Senior Editor

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