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NimbleGen and OGT Forge New Licensing and Supply Agreements

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Oxford Gene Technology this week licensed patents covering its oligonucleotide array technology to NimbleGen Systems, an arrangement that NimbleGen said would allow it to sell its arrays directly to customers worldwide.
 
The companies have also signed a supply agreement under which OGT will have access to NimbleGen’s DNA microarrays for use in its services business while giving NimbleGen the ability to make and sell OGT-designed arrays.
 
The companies would not disclose specific OGT-designed arrays that NimbleGen would be interested in offering discuss, nor would they discuss which NimbleGen arrays OGT had expressed an interest in using in its new custom services business.
 
NimbleGen CEO Stan Rose told BioArray News that the company was attracted to OGT’s “very creative” scientific team and its “close relationships with key customers around the world.”
 
The agreements come at significant moments for both companies: NimbleGen signed a similar licensing deal with Affymetrix in October for IP that the company said would enable it to strengthen the direct-sales portion of its business. To date, many of its customers’ projects have been run in NimbleGen’s service facility in Iceland (see BAN 10/10/2006).
 
Meantime, for OGT, the NimbleGen deal showcases its new strategy of using licensing agreements as a touchstone for expanding its nascent array business.
 
According to a statement from the companies, NimbleGen has obtained a license to OGT's Southern array patents, which cover the manufacture and commercialization of oligonucleotide arrays patented by microarray pioneer and OGT founder Sir Edwin Southern.
 
Sue Sutton, OGT’s vice president of licensing for North America, said in a statement that the licenses will enable NimbleGen to deliver its microarray products and services worldwide and that OGT is “also looking forward to being able to offer NimbleGen’s high-density microarrays within [its] microarray service business.”
 
Rose said that his company’s decision to license Affy’s IP last fall after years of working mainly through a services model was part of a sea change in the way the company does business.
 
“We already [directly] sell some arrays in some circumstances,” Rose wrote in an e-mail to BioArray News at the time (see BAN 10/10/2006). “We are now putting in place the infrastructure to sell, distribute, and support arrays on a much broader basis."
 
Rose said this week NimbleGen has “no other in-licensing activities to report at this time, [but] there are many issued patents in the life science field.” If the company believes its “commercial strategy requires access to additional intellectual property rights, it will take whatever actions it feels are necessary to ensure that it has the freedom to deliver its genomics products and services to its customers,” he wrote in an e-mail to BioArray News
 
The View for OGT
 
Since CEO Mike Evans took the helm of Oxford Gene Technology in 2005, the company has been building a catalog array business of its own. It currently develops chips for a variety of applications, including array comparative genomic hybridization chips for diagnosing genetic diseases as well as a suite of prokaryotic arrays for chromatin immunoprecipitation (ChIP)-on-chip experiments (see BAN 10/3/2006).
 
OGT was founded in 1995 to protect Southern’s patent estate, but has expanded its activities in recent years to focus on developing and commercializing its own products as well. “If you look to OGT three years from now, we would be a licensing company still, but we would hope to have revenue streams from products and services that we sell to the marketplace as well,” Evans told BioArray News in May 2005 (see BAN 5/17/2005).
 
OGT also seeks to parlay licensing deals into broader market reach. For example, after signing several licensing deals with Japanese companies last summer, Evans said that OGT could work with some of its new Japanese contacts to bring their arrays to Western markets.
 

If NimbleGen believes its “commercial strategy requires access to additional intellectual property rights, it will take whatever actions it feels are necessary to ensure that it has the freedom to deliver its genomics products and services to its customers.”

“As our Japanese licensing and business activities develop, we will be considering opportunities to transfer technology from Japan to the US and Europe,” he said (see BAN 10/3/2006).
 
“In situations where OGT believes that our business model can be enhanced by forming broader business partnerships, we will aim to capitalize on our licensing relationships,” Evans told BioArray News in an e-mail this week.
 
According to Evans, NimbleGen was attractive to OGT because of its high-definition array technology. The company plans to launch a second generation of high-density arrays this year that will feature 2.2 million features per chip.
 
“OGT is likely to develop specialized arrays that will fit well with NimbleGen’s high density offering,” Evans wrote, “but it is too early for us to disclose the applications that we are developing in this regard.”
 
OGT began offering services based on its own high-density arrays this week and is betting that the NimbleGen deal will enable it to reach more customers through its custom array business, a key component of its business strategy.
 

“We expect that customers will have a range of applications suited to high density arrays and OGT will position itself as an integrated and expert service provider – first helping our customers identify the best array platform for their application and then providing array design, custom array supply, and data analysis services,” Evans said. “This integrated approach will ensure that our customers get the best possible results from their research.”

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