Resverlogix Corp's early stage technology, ReVas, which is developing compounds for use with medical devices, found a partner in Medtronic Inc., to create a drug-eluting stent for cardiovascular diseases.

The companies will begin by completing the development of the technology. If they agree to move forward with product development, Medtronic would make an initial cash payment to RVX, a subsidiary of Resverlogix, followed by milestones and royalties. All told, RVX could receive up to C$340 million (US$291 million).

Resverlogix's stock (TSEX:RVX) jumped nearly 20 percent on the news, closing at C$6.50 Wednesday, up C$1.07.

"It's the largest preclinical deal ever done in Canada," said Don McCaffrey, co-founder, president and CEO of the Calgary, Alberta-based firm.

Resverlogix also gets to play a part in the burgeoning drug/device combination market, which already has produced Natick, Mass.-based Boston Scientific Corp.'s Taxus paclitaxel drug-eluting stent and Cypher, the sirolimus drug-eluting stent from New Brunswick, N.J.-based Johnson & Johnson. Medtronic's Zotarolimus (Abbott) drug-eluting stent, Endeavor, is finishing up clinical development for a U.S. application.

The stents are designed to prevent complications, such as restenosis, in patients who have undergone cardiovascular surgery, but all the devices are using "a version of either rapamycin or paclitaxel," McCaffrey said. Since both of those are oncology drugs, "they're a little harsh on the endothelial lining in the artery."

He added that while those drugs might be effective in preventing restenosis, "at 90 days out, you're seeing some thrombotic issues, some ruptures and, in some cases, death."

Resverlogix's ReVas program is aimed at designing a drug that "actually encourages the healing of the endothelial lining," in addition to reducing the smooth-muscle cell proliferation that leads to restenosis, McCaffrey said. "So, it's kind of a new generation drug for the stent market."

ReVas emerged when researchers discovered hydrophobic compounds while working on its NexVas cholesterol program. Since those compounds were unable to reach the liver or small intestine, they were useless as cholesterol drugs, but their non-systemic quality made them ideal for drug/device combos.

"Being hydrophobic and staying in the arteries is actually quite an advantage for this type of medication," McCaffrey said.

To keep its ReVas program separate, Resverlogix established the RVX subsidiary last year. RVX also holds the intellectual property relating to Resverlogix's TGF-Beta Shield technology for cancer and fibrotic diseases.

The company's lead program, NexVas, is expected to move a compound into clinical development within the next six months. That program focuses on creating therapies that increase high density lipoprotein (HDL) for cardiovascular disease.

"That's going to be a much larger market for us," McCaffrey told BioWorld Today. "We believe we have a breakthrough as the first company ever to be able to do transcription of the lipoprotein ApoA-1 gene, which is pretty much the Holy Grail of cholesterol research."

Resverlogix expects to seek a partner for the NexVas program, as well, and "we are proceeding nicely in some discussions there," he said.