SurroMed will parlay the misfortune of a collaborator into a program to develop a range of cancer diagnostic products, a company official told SNPtech Reporter this week.
The step, which will add on SurroMed’s experience helping others discover disease biomarkers, will catapult the tiny Mountain View, Calif., company into a rapidly growing — and hugely competitve — space that is likely to bring swift financial rewards.
“This is the first time we will be entering the cancer [diagnostics] market,” August Moretti, CFO of SurroMed, told SNPtech Reporter. “We’re just starting the program.”
SurroMed was able to take the cancer diagnostics step after it and pharmaceutical contract-research firm PPD expanded a biomarker-discovery collaboration begun in September. The updated partnership, announced late last week, followed PPD’s decision to shutter a functional genomics facility in Menlo Park, Calif., which SurroMed will move into in mid-August.
PPD’s move, which is part of a broader restructuring that aims at consolidating its discovery-sciences workforce, is part of an agreement in which PPD gives SurroMed an undisclosed cash payment and unloads to SurroMed its entire range of cancer biomarkers in exchange for $24 million worth of SurroMed’s preferred stock. The deal also calls for PPD to buy biomarker-discovery services from SurroMed over the next four years.
To be sure, SurroMed has hinted in the recent past its intent on turning itself into a diagnostics- and drug-discovery company. But this recent disclosure marks the first time the biomarker company has spelled out the initial steps in its strategy, and it is PPD’s biomarkers that SurroMed hopes to use as a launching pad into the molecular-diagnostics market.
“The first step in developing the diagnostic business would be through a reference lab — either one that we would establish here or through a license arrangement with established labs,” Moretti said. However, he said it remains “unclear at this point whether these products would ultimately be sold in kit form.”
Moretti suggested that a SurroMed diagnostic will likely be marketed as an ASR, but stressed that he doesn’t “have a close enough grip on the regulatory approach at this point to be specific about that.”
SurroMed will apply its mass spec and cytometry-based platforms to “a range” of tumor, sera, and urine samples it obtained through “an arrangement” with an undisclosed number of academic centers and hospitals.
The company, which was founded in 1997 and became operational in 2000, employs 60 people and is building its core business around immunoassays and an in-house bioinformatics platform.
So far, SurroMed has signed at least eight collaborations. In April, the firm penned a biomarker-discovery deal with Wyeth that uses SurroMed’s SurroScan laser-scanning cytometry system to locate biomarkers; in March, it signed a similar deal with InterMune to find biomarkers in samples for hepatic and pulmonary diseases; one month earlier SurroMed pocketed an undisclosed sum from a Fidelity Investments unit to discover and develop biomarkers for neurodegenerative conditions; and in October 2002 the firm shared with Callida Genomics a $7.6 million government grant to develop a high-throughput genotyping system. This deal, which was originally slated to go to SurroMed and Applied Biosystems until ABI backed out, will rely on SurroMed’s Nanoparticle platform to develop a tool that can score more than 100,000 SNPs per patient using a solution-array approach. The deal will net SurroMed $4.4 million over the next three years. And one month earlier, the company began using its mass-spec platform to identify biomarkers for Lilly.
SurroMed’s early work was centered around microvolume laser scanning cytometry, which enables users to measure up to 250 different inflammatory cell populations, as well as track up to 450 cell surface markers, according to a recent article in ProteoMonitor, SNPtech Reporter’s sister publication [read complete article here].
Later, after adding mass spectrometry, the company was able to boast of its ability to quantify large numbers of molecules without using isotope tagging.
Chris Becker, SurroMed’s director of chemistry, told ProteoMonitor that his group tracked 30,000 molecular ions — both proteins and metabolites — per pre-clinical sample in a recent study. Of those, the team identified more than 1,000 molecules that showed the most significant changes.
Because it is a new company, SurroMed will have to wait awhile before it becomes profitable. However, Nancy Grove, SurroMed’s vice president of business development, told ProteoMonitor:
“We are getting the burn down to where it’s tolerable. Our overall goal is to build a healthy sustainable company that’s known as a biomarker company, and we think we are on our way.”