AureoGen Biosciences: Company Founded by former Pharmacia Scientists Enters Agreement with Japanese Biotech Firm.

KALAMAZOO, Mich. -- AureoGen Biosciences, Inc., a Kalamazoo-based biotech company that is using an innovative genetic engineering technology for the discovery and production of novel antibiotics, has announced that it has entered into a license agreement with Takara Bio Inc. The agreement will provide AureoGen access to several patent protected antibiotic compounds, as well as a proprietary organism that produces a potent antifungal compound.

Using the company's engineering technology, AureoGen will genetically alter the genome in Takara's antifungal-producing organism to produce novel broad-spectrum drug candidates. These compounds will target systemic infections, a $4.3 billion world market that is projected to grow to $4.5 billion by 2014.

Ake Elhammer, AureoGen CEO, said the viability of the antifungal compound - currently the most promising candidate - should be known within the next two-to-three years, at which time the company could seek a buyer to take the drug into clinical development.

"Advances in the treatment and survival of transplantation, cancer, AIDS and other immunocompromized patients have led to a continuing increase in the incidence of systemic fungal infections," Elhammer says. "This increase, together with the fact that most drugs currently available for the treatment of these infections have significant limitations - limited efficacy, toxicity, problems with drug-drug interactions and the generation of resistant organisms - has created an immediate unmet need for new and novel antifungal drugs."

Elhammer says the compound has been successfully made through synthetic chemistry but that the cost of doing so is prohibitive. AureoGen intends to prove that the compound can be produced by genetic engineering of the producer organism, and that this is significantly less costly than synthetic chemistry. If successful, AureoGen will be the first company to introduce a genetically engineered compound for development.

AureoGen was founded in 2003 by Elhammer and Jerry Slightom, both former Pharmacia scientists, who took advantage of the community and state new business development incentives offered when Pharmacia was acquired by Pfizer. Since then, AureoGen's potential for the successful genetic engineering of antibiotics has been continuously recognized by the scientific community. In its first 18 months of business, AureoGen received more than $1.6 million in funding, including a $1.5 million Advanced Technology Program grant from the National Institute of Standards and Technology (NIST) and a Small Business Innovative Research (SBIR) Phase I grant from the National Institute of Health. To date, the company has received more than $6 million to fund its research, with recent additions being an SBIR Phase II grant from the NIH and a $1.9 million loan award from the Michigan Economic Development Corporation. For more information, visit www.aureogen.com.

Takara Bio Inc. is a $140 million Japanese biotech company with a long history and a strong focus on genetic engineering research. In addition to providing research reagents and equipment to the life science market, Takara Bio has active research and product development activities in the fields of gene and cell-based therapy, and agricultural biotechnology. The company is committed to preventing disease and improving the quality of life through the use of biotechnology. Through strategic alliances with other industry leaders, Takara Bio aims to extend its reach around the world. More information is available at www.takara-bio.com.