Genzyme acquires gene therapy assets from Avigen for $12 million plus potential royalties

By E. Janene Geiss

Philadelphia, Dec. 21 - Genzyme Corp. announced Wednesday that it has acquired extensive gene therapy assets from Avigen, Inc., including rights to a broad patent estate focused on adeno-associated virus technology, a phase 1/2 clinical development program in Parkinson's disease and a clinical collaboration in hemophilia.

In exchange for these assets, Genzyme has made an upfront cash payment of $12 million to Avigen and will make potential milestone and royalty payments based on the development, approval and sale of products developed under the intellectual property portfolio, according to a company news release.

The acquired assets will support and diversify Genzyme's gene therapy research program, which already includes work in cardiovascular disease, lysosomal storage disorders and other conditions.

Together with last month's acquisition of viral manufacturing facilities from Cell Genesys, Genzyme said it has significantly strengthened its ability to develop gene therapy products that utilize either adenovirus or adeno-associated virus vectors.

"This agreement provides Genzyme with a strong patent estate for our existing gene therapy platform and reflects our commitment to achieve the medical advances that we believe are possible with this technology," Rich Gregory, Genzyme's head of research, said in the release.

Avigen officials said the sale fits into its strategic plan to move from a gene therapy company to a pharmaceutical company focused on small molecule therapeutics to treat neurological disorders.

Avigen focusing on small molecules

In April, Avigen outlined three critical goals in shifting the company's focus.

"The sale of Avigen's AAV [adeno-associated virus] assets makes sense at multiple strategic and financial levels and represents the achievement of the first of three critical goals," Kenneth G. Chahine, Avigen's president and chief executive officer, said in the release.

Avigen's second goal was to reduce operational expenses by eliminating the need to maintain a virus manufacturing facility and associated expenses, Chahine added.

This shift has already led to cost reductions totaling over $2 million on an annual basis, and it allows the company to further reduce overhead expenses by subleasing unused parts of the facility, officials said.

Avigen said it plans to focus on small molecule therapeutics that have a more established and predictable development process when compared to gene therapy and allows Avigen to leverage part of the development with external contractors.

Arterial disease gene in phase 2 trial

The most advanced program in Genzyme's gene therapy portfolio is a phase 2 clinical trial examining the safety and effectiveness of locally delivered Ad2/HIF-1alpha, an engineered form of the HIF-1alpha gene.

This experimental therapy is designed to promote the growth of new blood vessels and improve circulation in the limbs of patients with peripheral arterial disease, officials said.

Genzyme's gene therapy portfolio also includes preclinical work related to lysosomal storage disorders and atrial fibrillation through a partnership with Excigen, Inc.

Genzyme said it is also conducting preclinical gene therapy research through a joint effort with Applied Genetic Technologies.

The phase 1/2 clinical trial in Parkinson's disease is designed to evaluate the safety of increasing doses of AV201 in individuals with mid- to late-stages of the disease. AV201 is designed to restore the therapeutic effectiveness of levodopa, the primary treatment for Parkinson's disease, by enhancing the brain's ability to convert it into dopamine, officials said.

Genzyme is a Cambridge, Mass., biotechnology company focused on developing products and services for rare inherited disorders, kidney disease, orthopedics, cancer, transplant and immune diseases and diagnostic testing.

Avigen is an Alameda, Calif., biopharmaceutical company focused on unique small molecule therapeutics and biologics to treat serious neurological disorders, including neuropathic pain.

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