Chiroscience signs deal for asthma drug

Chiroscience shares jumped 17.5p to 255p yesterday after the biotechnology group announced a tie-up with Schering-Plough of the US in a deal worth up to $38m (pounds 23m) to develop asthma and other drugs.

The US group, regarded as number three in the treatment of respiratory diseases, will underwrite the research and development of Chiroscience's class of anti-inflammatory treatments known as PDE IV inhibitors, including what is being claimed as the leading treatment for asthma, codenamed D4418. In exchange, Schering will be given exclusive world-wide rights to any drugs which result from the research.

John Padfield, Chiroscience chief executive, said asthma was a growing problem, affecting some 14 per cent of the Western World's population. "To be working on our PDE IV inhibitors with a company of the calibre of Schering-Plough is exciting and acknowledges the success we have achieved to date with D4418 and other research compounds," he said.

Chiroscience estimates the Western market for asthma drugs is worth around $4bn, but claims that only half of all sufferers are treated due to difficulties in using treatments. Children, for instance, have problems using inhalers to take drugs such as Glaxo's Becotide, one of the leading treatments for asthma. Chiroscience's product will be in pill form. However, it is not expected to reach the market before 2003, even if it clears clinical trials currently under way in phase I.

Last year, Celltech, another biotech group, and Merck of the US abandoned development of a rival PDE IV-based product, codenamed CDP840. Chiroscience now reckons it has the lead in this class of drug, which it claims is the only one which attacks all four main components of asthma - wheezing at the beginning and after an attack and the associated inflammation and phlegm brought up from the stomach.

Other uses for the treatment being researched include chronic bronchitis, rheumatoid arthritis and the skin conditions atopic eczema and psoriasis.

The group will receive an initial licence fee, milestone payments and research and development finance under the Schering deal, with any royalty payments coming in on top of the initial $38m maximum.

Separately, Shire Pharmaceuticals, another biotech group, announced it had secured certain exclusive marketing rights to distribute Urispas, a urinary treatment, from Recordati of Italy.