Trubion Pharmaceuticals Inc. signed its largest deal to date and set a high bar for 2006 by partnering with Wyeth Pharmaceuticals in a potential $840 million agreement to develop Trubion's small modular immunopharmaceutical (SMIP) platform.

"It's a strategic collaboration that is target-exclusive," said Peter Thompson, president and CEO of Seattle-based Trubion.

The companies will collaborate on CD20-targeted therapies, including TRU-015, an SMIP compound in Phase II studies for rheumatoid arthritis. Since CD20 is an antigen restricted to B cells, TRU-015 aims at depleting B cells.

Thompson said Wyeth's experience in rheumatoid arthritis made it an ideal partner. In fact, both companies have on their development teams researchers and management responsible for developing Enbrel (etanercept), a blockbuster drug for rheumatoid arthritis and other inflammatory disorders. Enbrel was first developed at Immunex Corp., of Seattle, in collaboration with American Home Products. Immunex later merged with Thousand Oaks, Calif.-based Amgen Inc., and AHP became Wyeth, of Madison, N.J..

Since former members of Immunex's senior management team joined Trubion, the collaboration with Wyeth brings together "folks on both sides that worked successfully to develop Enbrel," Thompson said.

In addition to CD20, the companies will collaborate on other targets that have not yet been disclosed.

Wyeth will receive worldwide rights to CD20-targeted SMIPs, as well as product candidates that stem from the joint discovery program. Trubion earns a $40 million up-front payment and retains an option to co-promote drugs in the U.S. for certain indications. Future development and commercialization costs will be handled by Wyeth, which will pay Trubion milestones that could total $800 million. Trubion also is entitled to royalties, and Wyeth agreed to a stock purchase if and when Trubion goes public.

Since it was founded about three years ago, Trubion has been developing the SMIPs, single-chain polypeptides "that are about a third to half the size of antibodies," Thompson said, "yet have long in vivo half-lives and are easy to manufacture."

SMIPs' small size allows them to penetrate the disease site and diffuse more rapidly than antibodies, Trubion said. And their modular design allows for adding specific structures to the compound for targeting purposes.

Trubion "is fundamentally in the drug assembly business," Thompson said, "and we have an efficient product engine."

Though the company hasn't been around long, "we already have a product in Phase II development and an expanding portfolio of products behind that," he added.

The company is determining which product it will advance into the clinic next. One possibility is TRU-016, which targets a different B-cell receptor from CD20 and has shown some "interesting property" in early research, Thompson said.

Trubion has raised about $45.6 million since inception, including a $32 million Series B financing completed in 2004. (See BioWorld Today, July 15, 2004.)