Privately held Kalypsys Inc. entered a four-year agreement with eye care company Alcon Inc. to develop ophthalmic drug candidates using Kalypsys' drug discovery technology.

Throughout the collaboration, San Diego-based Kalypsys will apply its ultra-high-throughput (uHTP) screening technology and chemical library to identify molecules against targets. For any drug candidate selected, Alcon would be responsible for conducting preclinical and clinical work, manufacturing and commercialization.

Specific financial terms were not disclosed, but Kalypsys President and CEO John McKearn called the deal "substantial."

"Any deal is important for an early stage company like Kalypsys," he added, "especially when you can bring a world leader like Alcon into the family."

Alcon agreed to pay Kalypsys an access fee, research support and milestones, plus royalty payments on net sales. The deal also provides Fort Worth, Texas-based Alcon an opportunity to partner compounds from Kalypsys' internal pipeline.

"There are basically two components," McKearn told BioWorld Today. "The first is an R&D component, where we'll use our ultra-high-throughput screening capability and our medicinal chemistry capabilities.

"The second component gives Alcon the ability to cherry pick a project compound from our pipeline," he said.

That pipeline includes preclinical-stage compounds targeting arthritis and inflammation, oncology and certain metabolic disorders. Its lead program, a peroxisome proliferators activated receptor (PPAR)-delta activator, is designed to regulate metabolic syndrome.

The company also has an inducible nitric oxide synthase (INOS) inhibitor, which is designed as a topical agent to treat a peripheral component of neuropathic pain. An oral INOS compound for systemic use is in earlier stages of development.

Finally, Kalypsys has been working on a histone deaceytlase (HDAC) program in oncology.

"We're planning to open up clinical trials soon," McKearn said, though the company has not yet released a specific time frame for clinical development.

In the meantime, Kalypsys plans to partner some of those programs, namely the PPAR-delta program, which targets a large market, and anticipates using its drug discovery engine to sign more deals like the one with Alcon.

Though Kalypsys probably is best known for its uHTP platform, McKearn said that's only a "partial characterization" of the company.

"That's like saying Roger Clemens has a good fastball," he said. "You've got to have more than one trick to survive in this business."

Kalypsys has extensive medicinal chemistry capabilities, as well as a chemical library containing nearly a million compounds, McKearn said. And the company tends to rely on research based on high-throughput profiles, rather than just in silico computational tools.

"We want to know is not only what the drug does to the body, but also what the body does to the drug," he said. "And we do all that work very early so we can select the best druggable chemotype."

Founded in 2001, Kalypsys has raised $72 million to date. Its last financing came in August 2004, when the company brought in $29 million in a Series B round.

Since its inception, the company has grown to more than 100 employees.