Lexicon achieve performance milestone

Lexicon Genetics has completed a second performance milestone in its drug discovery alliance with Genentech.

The companies entered into a drug discovery alliance in December 2002 to discover novel therapeutic proteins and antibody targets. Under this alliance, Lexicon is discovering the functions of potential therapeutic proteins and antibody targets identified through Genentech's internal drug discovery research.

The milestone payment is related to Lexicon's production of gene knockouts in mouse embryonic stem cell lines for all of the proteins selected for inclusion in the alliance. Lexicon has completed the generation of knockout mice and identified the physiological functions of many of the proteins in the alliance. Lexicon is in the process of discovering the therapeutic potential for the remaining proteins. The amount of the milestone payment was not disclosed.

'The rate of progress of our alliance with Genentech is exceeding expectations,' said Dr Arthur Sands, president and chief executive officer of Lexicon. 'We have already made some impressive discoveries, and we hope the medical impact of this program will ultimately be quite profound.'

In addition to performance-based milestone payments, Genentech will make payments to Lexicon upon achievement of milestones related to the development and commercialisation of therapeutic proteins and antibodies resulting from the alliance. Lexicon is also entitled to receive royalties if net product sales of these proteins and antibodies are achieved. Lexicon retains certain rights to these discoveries, including non-exclusive rights for the development and commercialisation of small molecule drugs.