Embrex Inc. said it has reached a collaborative researchagreement with an undisclosed major pharmaceuticals andchemicals company to study methods for modifying the geneticmakeup of poultry while the birds are still embryos.

Terms of the agreement, while not specified, "are reasonablysignificant for a small company, in the hundreds of thousandsof dollars," Embrex President Randall Marcuson told BioWorld.

The company (NASDAQ:EMBX) will be funded for an initial two-year feasibility study to test its proprietary egg injector as avehicle for delivering genes into chicken embryos. Typicaltechniques of genetic engineering will be used, but thecompany will also be developing novel techniques for genedelivery, Marcuson said.

Embrex, located in Research Triangle Park, N.C., has othercollaborations for uses of its egg injector. Partners includeAbbott Laboratories, American Cyanamid and Sanofi.

The injector can place vaccines and biologically active peptidesinto precise regions of the unhatched embryo at the rate of20,000 eggs an hour.

The company recently completed field tests of its second-generation injector, which Embrex intends to lease directly topoultry producers on a fee-per-egg basis.

The company holds a license to a patent held by the U.S.Department of Agriculture for the process of vaccinatingpoultry embryos, and has filed its own patent applications forthe injection of other compounds into eggs.

Embrex stock closed unchanged Thursday at $7.63. InNovember, the company completed an initial public offer of 2.2million shares at $8.50, plus 2.2 million warrants at 10 centseach. -- Roberta Friedman, Ph.D.

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