Washington Editor

Shares in Targeted Genetics Corp. received a 33 percent boost on news of a $22 million federal contract to complement and expand ongoing HIV vaccine development efforts that include the company and two collaborative research hospitals.

Stacie Byars, the company's director of communications, called it "a tremendous statement" that the government is supporting "the work of Targeted Genetics and its collaborators." She told BioWorld Today that such financial backing validates previous work on adeno-associated virus (AAV)-based vaccines, research that has taken place in a range of diseases and now is getting national support in HIV.

The Seattle-based company's stock (NASDAQ:TGEN) jumped 16 cents on Monday, to close at 64 cents.

Targeted Genetics and its scientific partners at The Children's Hospital of Philadelphia and Columbus Children's Research Institute received the grant from the National Institute of Allergy and Infectious Diseases, part of the National Institutes of Health (NIH). The funding will allow the company to expand its HIV vaccine program beyond the scope of an existing collaboration with the International AIDS Vaccine Initiative (IAVI), which is focused entirely on producing an AAV-based vaccine for use in developing nations. That research has defined AAV's potential as a vector for the vaccines.

"I think that has really impressed the federal government, and the NIH in particular, to actually realize that AAV is potentially an important platform on which they'd not focused before," said Barrie Carter, executive vice president and chief scientific officer. "Based upon what we've done with IAVI, we were able to make a pretty good case that there is a reason to really expand upon this program to focus on the entire world, the developed world as well."

So new AAV-based vaccine efforts will address HIV subtypes germane to the developed world, such as clade B, and focus on different AAV serotypes that can impact efficiency. In addition, future work will test priming doses with boosters, each of which could involve multiple AAV serotypes, and multigenic HIV vaccines also are being planned.

"AAV vectors, unlike almost any other type of delivery system used for genetically vectored vaccines, will express whatever the antigen is you're expressing and keep on expressing it for a prolonged period of time," Carter told BioWorld Today. "So the idea is to have persistent expression of antigen, which may give a more robust and durable response."

The new funds also will be applied toward optimizing the manufacturing process. Clinical trials of a candidate vaccine will be coordinated through the NIH-sponsored HIV/AIDS Vaccine Trials Network. Philip Johnson, chief scientific officer at Children's Hospital of Philadelphia and previously at Columbus Children's Research Institute, is the contract's principal investigator.

He has been central to the previous AAV-based HIV vaccine work that involves Targeted Genetics and IAVI, a broad effort that has a pair of ongoing clinical studies of an investigational vaccine called tgAAC09. The preventive vaccine is designed to elicit two different types of immune responses, an antibody response and a cell-mediated response, and its intramuscular delivery is thought to extend its effectiveness.

"It boosts both T and B cells," Byars said of findings from animal and early clinical studies. "It creates a response in both areas, and ultimately that's believed to be what will prevent HIV from progressing to AIDS."

Earlier this month, the collaborative group began a Phase II trial in South Africa to test the AAV-based vaccine's safety and immunogenicity. tgAAC09 is based on HIV clade C, which is the most prevalent subtype in southern and eastern Africa. The study is being conducted at three sites, should take about 18 months to complete and will enroll 78 volunteers who are in good health.

It follows a Phase I study that is continuing in Belgium, Germany and India, which is designed to assess safety and immune responses in healthy volunteers who are not infected with the virus. Earlier this year, preliminary results demonstrated that tgAAC09 met the safety endpoint and was well tolerated.

That trial tested single administrations of a low dose of the vaccine and elicited no immune responses, so the South African study will evaluate a higher dose. Other studies also will test priming doses with boosters, as well as combinations in tandem with other therapies.

As a subcontractor, Targeted Genetics is eligible to receive up to $18 million of the $22 million total over five years. Byars said the federal funds positively "augment the work we've already done," which Carter said "has gotten a lot of the technology off the ground."

Therefore, the new grant represents an opportunity for the company to advance those efforts more broadly than ever before "to expand into a whole bunch of other questions and into additional ways of doing this," Carter said.

Targeted Genetics, which had $17.2 million in cash reserves as of Sept. 30, also is developing targeted molecular therapies for the prevention and treatment of inflammatory arthritis and other acquired and inherited diseases. Its product development efforts target inflammatory arthritis, HIV/AIDS, congestive heart failure, Huntington's disease and hyperlipidemia.