Associate

CytRx Corp. licensed out its former lead product, Flocor, and other co-polymer technologies to SynthRx Inc., allowing CytRx to train its eyes solely on RNA inference technology.

It's in with the new, out with the old.

"It's the last of the old CytRx - we've licensed out all our old technology," said Steven Kriegsman, CEO of Los Angeles-based CytRx. "We can now totally focus on our RNAi."

The company had built its name on Flocor, Opti-Vax and other co-polymer technologies, until it merged with Global Genomics Capital Inc. in early 2002 and Kriegsman took over as CEO. In April, the company announced it had licensed RNAi technology from the University of Massachusetts Medical School, officially becoming an RNAi company. (See BioWorld Today, Feb. 12, 2002, and April 22, 2003.)

Through the outlicensing, CytRx has taken a 19.9 percent stake in privately held SynthRx, of Houston. CytRx also receives an up-front payment and could receive milestone payments and royalties. The deal shouldn't surprise industry observers - CytRx had previously made it clear it wanted to push the product out of house - and neither should the partnering choice: SynthRx CEO Robert Hunter was a founder of CytRx and sits on its scientific advisory board.

"We had other options, but they didn't know the technology as well as [Hunter]," Kriegsman told BioWorld Today. "Hunter developed the compound and knows it better than anyone else in the world."

Also, he said, "We couldn't get 19.9 percent of [other potential partners]."

Flocor (purified poloxamer 188) is an intravenous agent designed to interact with cell membranes to repair damage, to block cellular adhesion and improve microvascular blood flow. It has been tested in more than 4,000 patients, Kriegsman said, including those in a Phase III trial in a sickle-cell disease indication. That trial failed in 1999, as the drug missed its primary endpoint of decreasing the length of sickle-cell anemia-associated vascular occlusive crisis. Hunter has several options to advance Flocor now, Kriegsman said. (See BioWorld Today, Dec. 22, 1999.)

"He could do a new Phase III for sickle cell," he said. "He could do a new Phase II/III for any of the cardiac indications." Kriegsman noted the compound has been through a Phase I study in an oncology indication, so that's a possibility as well.

"He's got a lot of options, and they're all good," Kriegsman said.

The drug has billion-dollar potential in the cardiac arena, Kriegsman said, and "probably a couple of hundred million dollars" in sickle cell. But that's out of CytRx's hands now - just the way Kriegsman wants it.

"It's a terrific restructuring for CytRx - why develop [a product] when we don't want to be in it?" he said. "Let someone else do the work. We'll reap the benefits, and they will, too."

With the storage room empty now, CytRx can put all its efforts toward RNAi in Lou Gehrig's disease (amyotrophic lateral sclerosis, or ALS), Type II diabetes and obesity, although it also has an HIV vaccine program with UMMS. Last month, CytRx raised $8.7 million in a private placement, using the money to establish an RNAi subsidiary that will focus on obesity and Type II diabetes. That undertaking is progressing well, Kriegsman said, noting that "we are in a hiring mode" in Worcester, Mass., where the subsidiary, Araios Inc., is located.

RNAi seems young, its science burgeoning, as companies gather intellectual property and refine the technology. But Kriegsman said clinical trials might come sooner than some think.

"I'm not so sure it's a ways off," he said. "We think it's possible [for CytRx] before the end of next year in ALS. That's a goal." He added that, together with UMass, they have "already knocked out the SOD1 gene in rats and mice."

Kriegsman attended the Rodman & Renshaw Techvest Healthcare conference in Boston, where he offered a company presentation. Before he left the city to return to Los Angeles, he stopped at the Admirals Club and did an interview for the radio program Biotech Today via telephone, in which he described CytRx's plans and goals. Now more than ever, those plans and goals are solidly focused on RNAi, and Kriegsman is letting people know.

"We're extremely excited," he said. "We really think we are going to find a cure for Lou Gehrig's disease. We can feel it. It's going to take some time, but we believe we have the scientists committed to curing this disease."

CytRx's stock (NASDAQ:CYTR) rose 6 cents Thursday to close at $2.45.