Roche gets value with GEMS

SOUTH PLAINFIELD, N.J.—PTC Therapeutics' GEMS—GeneExpression Modulation by Small-molecules, a screening technology foridentifying small molecules that up- or down-regulate target proteins—will formthe basis of a research collaboration and licensing agreement with Roche forthe development of orally bioavailable small molecules active against fourcentral nervous system (CNS) disease targets that will be jointly selected.

Under the terms of the agreement, Roche will make an upfrontcash payment of $12 million and fund PTC's research efforts. Subject toachievement of several successive milestones, there is the potential for PTC toearn up to $239 million in research, development, regulatory and commercialmilestone payments per target, putting the potential value of the deal atupwards of $950 million. In addition, if Roche exercises its option to addanother four targets in other therapeutic areas, PTC would qualify for cashpayments based on the same formula.

PTC is a privately held company with about 200 employees andno sales to date. The company name is derived from "post transcriptionalcontrol," which is functionally how compounds identified by the GEMS platformregulate the rate and timing of protein production vital to proper cellularfunction. Compounds identified through the GEMS technology target processesthat act through the regulatory regions of messenger RNA molecules.

According to Cláudia Hirawat, senior vice president ofbusiness development at PTC, there is a general belief that the coding area ofthe gene is the only important region. The untranslated regions (UTRs) are frequentlyoverlooked. It's much like a recipe, she says.

"The coding region provides the ingredients, while the UTRstell you how to put them together," Hirawat says.

The GEMS platform identifies compounds that either inhibitor activate expression of the reporter protein. Compounds causing astatistically significant alteration in reporter expression in the primary HTSare confirmed to demonstrate dose-response activity and are immediatelyadvanced to secondary functional screens designed to evaluate endogenous andphysiologically relevant cell-based protein synthesis. Compounds thatdemonstrate activity against the endogenous target protein progress tofollow-up assays that assess specificity with respect to similar targets.Confirmed hits are further characterized for pharmaceutical properties such ascytotoxicity, metabolic stability and bioavailability. Compounds demonstratingdesirable activity profiles can then be advanced as leads in a drug discoveryeffort.

Morgan Conn, senior director of business development at PTC,notes that the company has successfully employed GEMS technology in severaldrug discovery programs across multiple therapeutic areas, including oncology,infectious diseases and neuromuscular disorders, with several programs either inthe clinic or in the late stages of lead optimization. PTC299, a small-moleculeinhibitor of VEGF expression, is undergoing multiple Phase 1b/2 clinicalstudies in cancer, he notes. GEMS is also being utilized in multipletherapeutic areas as the basis for collaborations with Schering-Plough(hepatitis C), Gilead (cardiovascular), Celgene (oncology), Pfizer (multipleareas) and CV Therapeutics.

"We are pleased to enter into this collaboration with PTCTherapeutics. PTC's expertise in small molecules addressing RNA biology and thedemonstrated productivity of their GEMS technology platform make this anattractive collaboration," says Dr. Christer Nordstedt, head of CNS Discoveryat Roche. "We believe that this novel and highly innovative technology will enableRoche to address important disease mechanisms that were intractable withconventional approaches. This may have profound impact on the treatment andmanagement of several CNS disorders and therefore lead to great benefits forthe patient."