While waiting to price its initial public offering, Anacor Pharmaceuticals Inc. signed a deal with GlaxoSmithKline plc for the discovery, development and commercialization of small-molecule, boron-based antivirals and antibacterials.

Anacor will manage discovery and development through clinical proof of concept, at which point GSK will have the exclusive option to license eight product candidates against four undisclosed targets, taking over further development and worldwide commercialization.

In exchange, GSK will pay Anacor $12 million up front and make a $10 million equity investment. Anacor also stands to get discovery, development, regulatory and commercial milestones that could reach $252 million and $331 million for each product candidate, as well as tiered double-digit royalties on future sales. All told, the deal could be worth more than $2.5 billion to Anacor.

GSK's interest centers on Anacor's expertise with boron, a naturally occurring element found in coffee, vegetables and other sources but not widely used in pharmaceuticals. Yet boron's unique properties allow it to bind and interact with biological targets in ways that traditional carbon-based drugs cannot, offering the potential to hit difficult targets and overcome resistance issues.

"Chemists talk about exploring chemical space, and boron allows you to explore different spaces than carbon," explained GSK spokesman Rick Koenig. That capability is of "particular interest" when dealing with drug-resistant bacteria, he added.

As part of the collaboration, Anacor retained the right to supplement its own internal pipeline with any compounds GSK elects not to license.

Although the GSK deal will evaluate systemically-delivered compounds, Anacor's current pipeline focuses on topical applications of its small-molecule, boron-based compounds.

The most advanced is AN2690, a topical antifungal for toenail onychomycosis partnered with Schering-Plough Corp. The drug, which interferes with fungal protein synthesis by targeting leucyl-transfer RNA synthetase, has completed three Phase II trials and is slated to begin Phase III next year. (See BioWorld Today, Feb. 5, 2007.)

Also in clinical development is AN2728, a topical anti-inflammatory that inhibits TNF-alpha and other cytokines and is expected to begin its second Phase Ib and first Phase II psoriasis trials later this year. Just behind it is AN0128, a topical anti-inflammatory and antibacterial that may be applicable in treating acne and gingivitis and has completed a Phase Ib trial.

Earlier in development is AN2718, a topical treatment for vaginal candidiasis, or yeast infections, and tinea pedis, or athlete's foot. Anacor plans to file investigational new drug applications for both indications next year. The company also is conducting early stage research on systemic antibiotics for hospital-based infections.

The new partnership will be managed through London-based GSK's Infectious Diseases Centre of Excellence for Drug Discovery, which was formed earlier this year as part of GSK's continued commitment to anti-infectives and antibacterials, Koenig said. The center is headed by Zhi Hong, former executive vice president and chief scientific officer of San Diego-based Ardea Biosciences Inc.

Koenig said the infectious disease center, along with GSK's other drug discovery centers in various areas of therapeutic interest, have begun to incorporate some of the principals of GSK's business development group, the Center of Excellence for External Drug Discovery. As evidenced by the Anacor deal, the centers are looking to "bring in entire programs" rather than just individual compounds, he said.

But that's not to say GSK won't jump on the right single compounds, as evidenced by the big pharma's potential $2.1 billion deal with Genmab A/S for the late-stage cancer drug HuMax-CD20. GSK also has done a fair amount of platform technology deals, like its $454 million acquisition of antibody company Domantis Ltd. and its $54.8 million acquisition of discovery company Praecis Pharmaceuticals Inc. (See BioWorld Today, Dec. 11, 2006, Dec. 20, 2006, and Dec. 22, 2006.)

On Monday, GSK also promoted its former head of Pharmaceuticals Europe, Andrew Witty, to the post of CEO.

Anacor did not return calls seeking further comment. The Palo Alto, Calif.-based company, which filed last month to raise up to $57.5 million in an IPO, is still in a quiet period. (See BioWorld Today, Sept. 5, 2007.)