Genelabs Technologies Inc. and Proteus International plc saidTuesday that they have formed Progene Partners, an equallyowned joint venture general partnership to design and developDNA-binding drugs focused on viral infections and cancer.

Progene will design drugs that bind specifically to targetedDNA sites, such as gene regulatory regions, to alter or blockdisease-causing gene expression. Target genes will be cancer-causing oncogenes and viral infection genes.

Each company will contribute complementary technologies tothe partnership, with each company bearing its own costs.

Genelabs of Redwood City, Calif., has developed in vitro assaysystems to screen for small, DNA-binding molecules thatinteract with known DNA sequences.

Using this sequence specificity information, Marple, England-based Proteus will use computer-aided molecular modeling andrational drug design technology to design candidatecompounds.

While DNA-binding drugs have long been in use -- asantibiotics and chemotherapeutics, for example -- their lack ofsequence specificity frequently results in toxic side effects, thecompanies said. Progene hopes to minimize toxicity bydeveloping sequence-specific molecules.

Genelabs shares (NASDAQ:GNLB) were down 75 cents to $6.38on Tuesday. Proteus shares are traded on the London stockexchange. -- KB

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