LONDON (Reuters) - GlaxoSmithKline boosted its position in biotech on Thursday by signing a deal that could be worth up to $600 million (303 million pounds) with Regulus Therapeutics, taking it into the hot area of RNA technology.
The tie-up covers research into experimental drugs designed to block or "silence" microRNAs -- tiny strands of RNA, or ribonucleic acid, that help turn genes into proteins.
Regulus is a joint venture between U.S. biotech companies Alnylam Pharmaceuticals Inc and Isis Pharmaceuticals Inc .
The aim of the deal is to develop and market new microRNA-targeted treatments for conditions caused by chronic inflammation, such as rheumatoid arthritis and inflammatory bowel disease.
The collaboration, however, will not yield any early results and there is no guarantee of success. Regulus Chief Executive Kleanthis Xanthopoulos told Reuters it could be three years before drug candidates were identified for clinical trials.
Still, Jose Carlos Gutierrez-Ramos, head of Glaxo's inflammation research centre, thinks it is worth a gamble.
"When associated with an aberrant inflammatory response, microRNAs represent disease targets whose therapeutic modulation could revolutionise the way we treat immune diseases," he said.
Europe's biggest drugmaker by sales has an option to license product candidates directed at four different targets, with Regulus eligible to receive up to $144.5 million in milestone payments for each.
In addition, Regulus will get $20 million in upfront payments, including a $15 million option fee and a $5 million note convertible into Regulus common stock. It will also receive up to double-digit percentage royalties on worldwide sales of products resulting from the alliance.
For Glaxo, the deal is another example of "virtualising" some of its drugs pipeline by complementing in-house research with external alliances.
The high price it is paying for such early-stage research underlines the current hunger among large pharmaceutical companies for promising biotech assets.
Xanthopoulos said Regulus had also seen strong interest from big drugmakers in its oncology and virology programmes, some of which are more advanced than the inflammatory work. But he added it was not his goal to strike further deals in 2008.
MicroRNAs are a recently discovered class of molecules that are believed to regulate the expression of a large number of human genes. The inappropriate absence or presence of specific microRNAs has been linked with cancer, viral infection, inflammatory and metabolic disorders.
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