Continuing its recent flurry of in-licensing activities, ophthalmic drug company Sirion Therapeutics Inc. added a third compound to its clinical pipeline and gained a drug discovery unit through its acquisition of Sytera Inc.

Since it was formed in late December, Sirion's goal has to been to "build a pipeline that's diverse across ophthalmic indications and across different stages of development," said Barry Butler, president and CEO of Tampa, Fla.-based Sirion.

In June, the company licensed its first compound, a topical emulsion product containing the steroid difluprednate for moderate to severe ocular inflammation, from Senju Pharmaceutical Co. Ltd., of Osaka, Japan. A month later, Sirion gained rights to a topical cyclosporine product from Laboratorios Sophia SA de CV, of Guadalajara, Mexico.

Both products have completed extensive testing outside the U.S., so Sirion plans to move into Phase III trials of difluprednate in the second half of this year and in cyclosporine during the first half of 2007. If all goes as planned, they could hit the market in 2008.

"Since those are later-stage products, we felt that adding a back-of-the-eye product and a drug discovery unit would really round out our company," Butler said.

That led to the deal with Sytera, a firm founded in La Jolla, Calif., in 2004 to develop drugs for the atrophic form of age-related macular degeneration (AMD), also known as dry AMD. Sytera's lead product, fenretinide (now known as ST-602) is in development for geographic atrophy, the most advanced form of dry AMD.

Sirion's management team was familiar with Sytera's work prior to the merger. Rx Development Resources LLC, a contract research organization co-founded by Butler two and a half years ago, had been doing the bulk of Sytera's AMD research.

"We really liked the technology," Butler told BioWorld Today, "so we decided it made a lot of sense for the two companies to join.

"Fenretinide is a really nice strategic fit to help move us into the top echelon of ophthalmic pharmaceutical companies," he added.

Specific terms of the deal were not disclosed, though Sirion said Sytera shareholders will be entitled to stock and cash up front, as well as development and commercialization payments.

Sirion expects to move fenretinide into a Phase II study in geographic atrophy (GA) later this year, and hopes to have "some evidence of efficacy" within a year or two, Butler said.

Research has attributed vision loss associated with dry AMD, GA and Stargardt's disease to an accumulation of lipofuscin in the eye. Fenretinide is designed as an oral compound to reduce lipofuscin accumulation by lowering the body's level of serum retinol.

AMD affects an estimated 1.8 million people in the U.S., with dry AMD making up about 90 percent. About 775,000 Americans are believed to suffer from GA, an aggressive form of AMD that can result in significant vision loss within a year or two of diagnosis.

There are no existing treatments for GA, and Butler described the market as comparable to that of the wet AMD space.

"So I think it has Lucentis-type potential," he said, referring to South San Francisco-based Genentech Inc.'s biologic for the wet form of AMD approved in June. Lucentis (ranibizumab) was launched the final day of the second quarter and recorded one-day sales of $10 million.

With the completion of the merger, Sirion intends to maintain its Tampa office and to expand Sytera's drug discovery group in San Diego, Butler said. "We plan to license some additional animal models to study other back-of-the-eye diseases and to put in some clinical and regulatory resources."

The combined company has about 40 employees, though Sirion plans to increase that number. Meanwhile, Sytera's management will stay on as consultants for a little while to help with the transition. Sytera chairman and CEO Kenneth Widder will join Sirion's board, along with Kevin Kinsella, of Avalon Ventures. Avalon, of San Diego, provided much of the venture capital for Sytera's work.

Butler anticipates seeking additional in-licensing deals and said the company is "going to continue to be active in the licensing space for the foreseeable future."