In its fourth major collaboration, Ambit Biosciences Corp. signed a deal with Cephalon Inc. to discover and develop kinase inhibitors in exchange for up to $250.5 million in up-front and milestone payments.

Work will combine Ambit's KinomeScan screening technology with Cephalon's expertise in chemistry, discovery and development. Ambit will screen a library of kinase-focused compounds from Frazer, Pa.-based Cephalon to deliver clinical candidates.

"It's really transformative for us," said Scott Salka, CEO of Ambit, which previously signed collaborations with the likes of Basel, Switzerland-based F. Hoffmann-La Roche Ltd., New York-based Bristol-Myers Squibb Co. and London-based GlaxoSmithKline plc.

Those earlier deals involved Ambit profiling its partners' compounds against a panel of assays and providing information on chemical activity and interaction, but the Cephalon deal is the first opportunity for "Ambit to collaborate very closely in the discovery stages," Salka told BioWorld Today, adding that it's also "the first time that we'll get very substantial milestones and royalties out of our discovery efforts."

Terms call for Cephalon to pay an up-front fee of $18 million to access Ambit's KinomeScan platform to screen libraries across a panel of 300 kinases. From there, the companies expect to work together to advance two programs targeting undisclosed kinases, with Cephalon taking the responsibility for clinical development and commercialization. Ambit would receive potential milestone payments of up to $232.5 million, plus royalties on any product sales.

Ambit, of San Diego, spent nearly three years developing KinomeScan to identify the potential of kinases, which include more than 500 related enzymes found to play a role across a range of diseases, for the development of small-molecule kinase inhibitors aimed at specific targets while keeping toxicity to a minimum.

Kinase inhibitors already have shown they are market-worthy. The first to reach approval was Basel, Switzerland-based Novartis AG's Gleevec (imatinib) for chronic myeloid leukemia in May 2001, which has been followed by Tarceva (erlotinib, Genentech and OSI Pharmaceuticals Inc.), and Nexavar (sorafenib, Onyx Pharmaceuticals Inc. and Bayer Pharmaceuticals Corp.).

Most recently, Sutent (sunitinib), a multi-tyrosine kinase inhibitor from New York-based Pfizer Inc., gained approval early this year in gastrointestinal stromal tumors and kidney cancer. (See BioWorld Today, Jan. 30, 2006.)

"When you have that type of success, you attract lots of attention," Salka said. "Now you have about seven small-molecule kinases approved, and they all seem to be doing much better than expected."

The difficulty in developing kinase inhibitors lies in the lack of specificity, due in part to the fact that there are so many kinases and all are so closely related, Salka said.

Ambit's goal is to create small molecules that are specific against particular kinases, will hit the targets identified at adequate dose levels and will reduce the chances for toxicity limitations.

In addition to its ongoing collaborations, the firm is working on its own internal pipeline using its compound library and panel of assays, and plans soon to announce the first clinical studies with a lead candidate from its receptor tyrosine kinase (RTK) program, AC220.

That product, which targets the kinase FLT3, will be tested first in acute myeloid leukemia patients.

While it's not the first RTK inhibitor to enter the clinic, Salka said, AC220 has shown efficacy without the "baggage" that surrounds some of the other candidates. For instance, MLN518 from Cambridge, Mass.-based Millennium Pharmaceuticals Inc. is "relatively specific, but not that potent," Salka said, and Novartis' PKC412 "hits a lot of other kinases and suffers from some off-target" effects.

MLN518 and PKC412 are in Phase II trials.

AC220's progression highlights the speed of Ambit's platform technology, which allowed "us to go from the first hit to the first dose in man in less in 25 months with just a small group of chemists," Salka said. "Now it's just matter of bringing as many compounds as possible into the clinic to see if they work in a therapeutic setting."

Following the introduction of its first candidate into human trials, the company anticipates filing additional investigational new drug applications on an annual basis.

KinomeScan also provides Ambit the potential for additional partnerships in the future. The technology works by broadly screening every compound, so "we end up with a couple of spin-out programs," Salka said.

For instance, the deal with Cephalon emerged as a spin-out program Ambit discovered while it was running assays that led to AC220.

"If we had not been screening broadly, we would have completely missed out" on that deal, he said.

Another spin-out program led to Ambit's deal with BMS last year. That collaboration focuses on discovering candidates against solid tumors.

Ambit received an up-front payment and an equity investment, and is entitled to profiling revenues over a five-year term.