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UPDATE: Incyte and Lexicon Genetics Set their Sights on Secreted Proteins

NEW YORK, June 28 - Hoping to combine genomic and proteomic data with drug target validation technology, Incyte and Lexicon Genetics have agreed to an anticipated five-year drug discovery partnership focusing on proteins secreted through cell membranes.

A panel of scientists from Incyte and Lexicon plan to jointly identify 250 secreted proteins with potential as therapeutic agents, and run them through Lexicon's mouse-based gene knockout system to determine their utility. 

In addition, the partners said they would share access to each other's proprietary databases. Lexicon will have access to Incyte's LifeSeq Gold, a database of full-length human genes and ESTs, and Incyte will have access to LexVision, a database of information acquired from mouse gene knockout experiments.

In a third element to the deal, Incyte has agreed to leverage its formidable sales force to co-promote and market Lexicon's LexVision database to major pharmaceutical and biotechnology companies. Lexicon CEO Arthur Sands said in a conference call that Incyte would receive a "significant percentage" of the revenues from any subscriptions to LexVision in return for its marketing efforts.

While the two companies did not disclose any financial details about the transaction, the deal makes sense in light of their complementary expertise. Incyte's LifeSeq Gold database, along with subsidiary Proteome's annotated database of proteins should in theory fill the pipeline of drug targets, and Lexicon's gene knockout models could prove which targets are worthwhile.

The two companies did not say how they would decide which partner would have rights to take a validated target forward into clinical trials. Neither Incyte or Lexicon have that capability themselves, so they would most likely need to find a pharmaceutical partner. 

Another unanswered question involves whether the focus on secreted proteins will run into patent problems. Human Genome Sciences has claimed to have obtained the intellectual property rights for most of these types of proteins, which have proved effective as pharmaceuticals in the past. "If you believe HGS, they may have covered the waterfront," said Winton Gibbons, an analyst with William Blair in Chicago.

But Incyte CEO Roy Whitfield claimed otherwise. "You have to look at the number of issued patents," he said. "We have 600 [covering genes that express secreted proteins] versus their 180."  He added, however, that the two partners would certainly try to steer clear of any obvious intellectual property claims.

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