Transgene SA entered its first product-development deal, a collaboration worth up to €218 million (US$293) on its late-stage therapeutic vaccine against human papillomavirus-related diseases.

F. Hoffmann-La Roche Ltd. is paying Transgene €13M up front and another €10M for a near-term milestone, along with up to €195 million in development- and sales-based milestones. In return, Roche gained worldwide rights to TG 4001 (MVA-HPV-IL2), for which Phase III trials are being planned.

Transgene, of Strasbourg, France, also would be entitled to double-digit, escalating royalties on sales. Transgene last year reported positive six- and 12-month data from a Phase II trial in women with high-grade cervical intraepithelial neoplasia (CIN 2/3), a precancerous cervical abnormality that can lead to cervical cancer.

The product is distinct from Merck & Co. Inc.'s recombinant vaccine Gardasil, approved last year in the U.S. and Europe as a preventive vaccine against HPV. GlaxoSmithKline plc, of London, also has a prophylactic vaccine, Cervarix, for which it filed for FDA approval last month. The Transgene vaccine is designed to treat, rather than prevent, HPV infections.

Philippe Poncet, chief financial officer at Transgene, pointed out that there are no approved treatments for HPV infections. The standard of care for CIN 2/3, he said, is surgical removal of the lesions.

Transgene began partnering discussions around mid-year 2006 with Roche, of Basel, Switzerland, and others, after the initial positive Phase II data, Poncet said. "But in the end you choose the one you feel is a better fit for you and your product, and also maybe more motivated than the others," he told BioWorld Today. "This is an innovative product with an innovative approach," he said. "Roche is certainly one of the companies with the highest skills in developing innovative biopharmaceutical products."

In addition to the €13 million Transgene received up front, the near-term €10 million milestone appears easily attainable, since it is "related to planning the Phase III studies," according to a news release. The "majority" of the €195 milestone potential is linked to development, Poncet said, with the rest tied to sales.

TG 4001 is based on a non-propagative, highly attenuated vaccinia vector (MVA) engineered to express HPV16 antigens, and an adjuvant. In those diagnosed with diseases caused by the HPV 16 infection, TG 4001 is designed to alert the immune system specifically to HPV16-infected cells that have started to undergo precancerous transformation, and to further stimulate the infection-clearing activity of the immune system through an interleukin-2 adjuvant, Transgene said.

Poncet said Transgene's plan always has been to partner the product after establishing proof of concept, due to the magnitude of the indication and the resources that would be required for Phase III testing and worldwide commercialization.

The details on an upcoming Phase III trial were not disclosed, but Poncet said he might expect Roche to begin a placebo-controlled study in 500 patients in the U.S. and Europe late this year or early next year. A likely endpoint, he said, would be eradication of precancerous lesions at 12 months. He stressed, however, that the plan going forward will come from Roche.

Darien Wilson, director of public affairs at Roche, said Phase III trials are expected to begin within 12 months. Other details were not disclosed.

Wilson told BioWorld Today, however, that the deal with Transgene does not signal a move by Roche into the vaccines business. Instead, she said, it supplements the company's existing oncology and virology franchises. It also is complementary to existing Roche HPV diagnostics.

Roche's Amplicor HPV Test and Linear Array HPV Genotyping Test have both been on the market in Europe for a few years. Both, too, are under FDA review. The Amplicor product is designed to detect 13 high-risk HPV genotypes, including HPV16.

The companies said HPV infection is the most common sexually transmitted disease, affecting about 400 million women worldwide. Most infections are spontaneously eliminated in less than one year. In the remaining cases, persistent HPV infection can lead, after years or decades, to CIN 2/3 and eventually to cervical cancer. Worldwide, new cases are reported at a yearly rate of around 1.4 million for CIN 2/3 and 500,000 for cervical cancer, of which about 50 percent are linked to HPV16, they said.

Merck's recombinant vaccine Gardasil, approved by the FDA in June, was shown to be effective against HPV types 16 and 18, which cause approximately 70 percent of cervical cancers, and against HPV types 6 and 11, which cause approximately 90 percent of genital warts. It is given as three injections over a six-month period, with a price of about $360 per treatment cycle. GSK, meanwhile, claims its Cervarix vaccine is more effective than Gardasil, and GSK has started a head-to-head trial of the products. Cervarix approval could come as early as late this year.

Prophylactic HPV treatment as addressed by the vaccines from Merck and GSK is expected to become a blockbuster market, with estimates up to $4 billion a year. But the Gardasil launch has come with controversy, whether it be related to mandatory vaccinations proposed by some states, reimbursement issues or the belief by some that vaccination could lead to increased sexual activity among those who may otherwise remain abstinent.

The FDA, in approving Gardasil, pointed out that clinical trials did not demonstrate protection in women already infected with HPV from developing diseases related to those viruses. Results showed that the vaccine is effective only when given prior to infection, the FDA said.

That's where the Transgene vaccine would come in. Poncet said TG 4001 is the most advanced product in development for treating CIN 2/3.

Transgene has three other vaccine products in clinical development. TG 4010, or MVA-MUC1-IL12, is in Phase IIb trials in non-small-cell lung cancer. It plans to partner that product in 2008, after the study ends. Another MVA-based product, TG 4040, is in Phase I trials for hepatitis C virus infection. It is too early to know about partnering plans, Poncet said. And TG 1042, an adenovector virus-based product delivering interferon gamma, is in Phase II trials for cutaneous T-cell lymphoma. Transgene intends to keep rights to that product, which addresses a smaller market, he said.

Transgene's stock (Eurolist:TNG) gained about 9.7 percent Wednesday to close at €18.70.