Proteros fragments, founded last summer to differentiate itself from its parent company's protein-crystallography business, this week announced its first deal, an agreement with Axikin Pharmaceuticals to discover lead compounds for inflammatory diseases.
Under the terms of the agreement, Proteros fragments, based in Martinsried, Germany, will "provide multidisciplinary research teams with the aim of generating multiple advanced lead series inhibiting a novel proprietary target protein," the two firms said in a joint statement.
They did not disclose the indication they would be chasing, though an Axikin official said it is associated with chronic obstructive pulmonary disease.
In the initial stages of the one-year collaboration, Proteros fragments will use its crystallography platform to decipher the X-ray structure of Axikin's novel protein, develop assays, and identify active fragments by screening Proteros' fragment library. The goal is to determine "the binding mode of the fragments to the target protein," Proteros fragments said in a statement.
In the second phase, Proteros' medicinal chemists will try to develop the selected fragments into novel lead drug candidates.
Axikin, based in San Diego, Calif., will pay Proteros undisclosed research fees and milestone payments.
The companies declined to disclose further financial details.
'Urgent Need' to Expand
The deal is the first one entered into by Proteros fragments since it was founded in August as a subsidiary of parent firm Proteros biostructures, when it bought the biochemical-screening and medicinal chemistry businesses of German firm GPC Biotech.
According to Gerhard Müller, formerly a vice president at GPC, now managing director and chief scientific officer of Proteros fragments, the parent firm had been preparing to offer a service business centered on the discovery of fragment-based lead structures even before GPC Biotech put its businesses up for sale.
After a decade in the protein crystallography-service business, Proteros biostructures "decided it urgently needed to expand" to create more value, Müller said. "We decided to expand the service offering from pure structure determination into the flanking areas of structure-based design of novel lead compounds, thus capitalizing on the 'old' Proteros strength in crystallography [and] simultaneously embarking into medicinal chemistry."
Rather than just fold the fragments business into the biostructures entity, management decided a separate firm was needed to prevent any uncertainty that might arise among clients about the different offerings.
"Proteros has a very broad, very international customer base from small- [and] medium-sized biotechs up to real big pharmas, and they do [a] very classical fee-for-service business in terms of providing their most valuable compounds to Proteros and getting the complex structures of those compounds in the context of the binding site of the protein," Müller said. "And the idea here was really to have a firewall between those two business units."
Two months before it created Proteros fragments, Proteros biostructures and Dutch research organization Merchachem Holding penned a joint-service-offering agreement covering fragment-based discovery, fragment evolution, hit-to-lead generation, lead optimization, and the preparation of preclinical development candidates.
According to Müller, the timing of the Merchachem deal was no coincidence. "That was the preparative state. …It was step 1 and step 2 of a thoroughly planned exercise," he said.
Unlike Proteros biostructures, which typically does "one-shot" deals with pharma in which it determines the protein crystal structure for a handful of compounds with a target protein, Proteros fragments' agreement with Axikin involves an integrated approach to determine the structure of the drug firm's novel protein and possibly developing a compound for the target, Müller said.
Proteros fragments will determine the structure of an Axikin proprietary protein, then perform fragment-based drug discovery with co-crystallography.
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Kevin Bacon, founder, president, and CEO of Axikin, which spun out from Actimis Pharmaceuticals in January, declined to identify the protein covered by the deal but said that it is associated with chronic obstructive pulmonary disease.
As a new firm, Proteros fragments has no track record, but Bacon said that he was familiar enough with the work of its parent company that he has no qualms. "The expertise that Proteros can bring to the table around the structural biology of novel proteins is what attracted them to us in the first place," Bacon said.
The deal with Axikin is also in line with a strategy that Proteros biostructures outlined in late 2007, which called for growing its business by focusing overseas, particularly toward the US pharma market [See PM 10/25/07].
In addition to Axikin, Proteros fragments is in "serious" discussions with about a dozen firms, including some US-based pharmas, about prospective deals, Müller said, though he declined to name them.
The company also is using Japanese pharmaceutical R&D support firm CTC Laboratory Services to drum up business there. Its parent firm has been able to sign on about four customers in Japan and Proteros fragments plans or has already held discussions with those firms about using its services.
The creation of Proteros fragments was completely financed internally without venture funding, and no funding rounds are currently planned, Müller said. He added that the company plans to reach profitability in two years.
Next, Protein-Protein Interactions?
The backbone of Proteros fragments is the technologies that form the core of Proteros biostructures: the Free Mounting System, which improves the fraction power and resolution of protein crystallography, allowing for more information about a protein-ligand structure; and the Picodropper technology, which allows the ligand solutions to be added to an FMS-mounted protein crystal.
Picodropper is particularly geared toward compounds of very low solubility or affinity where concentrations are not high enough for the compounds to get into the protein crystals, making the generation of protein-ligand complexes difficult.
In addition, Proteros fragments uses a fragment library that was originally developed at Axxima Pharmaceuticals where Müller was once CSO. GPC acquired the library, and Proteros fragments acquired it from GPC.
According to Müller, that library, along with FMS and Picodropper, is what separates his firm from other companies that provide fragment-based drug-discovery services such as DeCode Genetics, Evotec, and Galapagos BioFocus DPI.
The library, which is not commercially available, consists of tailor-made fragments. Unlike other firms with fragment libraries, Proteros fragments' library is not meant to blanket every possible fragment, but rather to cover target families that are of specific interest to industry, including protein kinases, proteases, nuclear hormone receptors, and phosphodiesterases.
"We rather focus on pharmacophoric information obtained thorough analyses of protein-ligand complexes," Müller said.
Proteros fragments has recently started exploring fragments that interfere with protein-protein interactions, which he said is "pretty much an unmet need today in medicinal chemistry."
While other firms have shied away from that field, its parent company's history in biostructures gives Proteros extensive knowledge into how molecules interact with such targets, Müller said.
The firm, however, is focusing on small molecules rather than protein therapeutics because of the challenge of translating complex protein-protein interactions into a small molecule.
"We are looking into the structural principles that really dominate the important protein-protein interactions, and what you see are regular secondary structure elements from protein structures," he said. "We have experience in translating peptidic sub-structures into non-peptide scaffolds. That's important because you do not want to end up with a peptide type of molecule that has all kinds of problems in the setting of medicinal chemistry," such as low selectivity.