BioWorld International Correspondent

PARIS - Genfit SA unveiled a development plan for the coming two years during which it aims to speed up its internal research programs, establish a presence in the U.S. and support the development of two spin-offs engaged in peripheral activities.

In particular, it plans to initiate clinical trials of its two leading drug candidates by the end of 2003.

The Lille-based company, which was founded in September 1999, seeks to discover and develop therapeutic targets by identifying the impairments in gene function behind certain common diseases. It is focusing its research on three pathologies: cardiovascular diseases, metabolic disorders and inflammation.

One of its lead compounds is for the treatment of lipid disorders, but also acts against diabetes and inflammation, while the other is for the treatment of stroke and the prevention of vascular accidents. Genfit's CEO, Jean-François Mouney, stressed the "multiple effects" of both candidate drugs. "The antistroke compound is also a neuro-protector when administered preventively to patients at risk," he told BioWorld International. "It protects the neurons and makes treatment more effective if a stroke does occur."

Besides its in-house drug development programs, Genfit entered into long-term research collaborations with six pharmaceutical companies, which ensured it a substantial revenue flow and enabled it to turn a profit in its first full year of operation. In 2001, moreover, its revenues soared by 175 percent to €6.6 million (US$6.2 million) from €2.4 million the year before, while its net earnings nearly quadrupled from €300,000 to €1.4 million from one year to the next.

Mouney explained that the better-than-expected earnings outcome in 2001 was largely due to the up-front payments received on the signing of its two most recent research collaboration agreements, signed in November with two French pharmaceutical companies: BioMérieux-Pierre Fabre, of Lyon, for the identification of the molecular mechanisms of action of new drug candidates for cardiovascular diseases, and Laboratoires Fournier, of Dijon, for the discovery of new therapeutic targets in the area of metabolic diseases. The deals guarantee Genfit research and development funding of at least €10 million over five years.

The other four companies with which it is engaged in ongoing research collaborations were all founding shareholders of Genfit: Sanofi-Synthélabo and UCB Pharma, both of Paris; Merck-Lipha, of Lyon; and the Strasbourg-based Franco-German company Aventis. Fournier became the company's fifth industrial shareholder upon signing its collaboration agreement, acquiring a 6 percent stake that put it on a par with the four others.

As regards its trans-Atlantic ambitions, Genfit plans to have a subsidiary up and running in Boston by the middle of 2003. Mouney said the objective was threefold: to strengthen its links with academia and forge new ties with other academic institutions and small biotechnology firms; to foster relations with large biotechnology and pharmaceutical companies in the U.S. with which it has no contact at present; and to be closer to the regulatory authorities in preparation for clinical trials.

The two peripheral businesses spawned by Genfit spin-offs provide technical input into its operations but also sell their services to third parties. One is IT-Omics, which was set up in 2000 to develop bioinformatics tools and is an autonomous affiliate over which Genfit has effective control. While Genfit remains IT-Omics' principal customer at present, its importance will decline over time as IT-Omics concludes new contracts with other clients. Mouney said he expects IT-Omics to move into profit in 2003.

The other venture is CardiAlpha, which Genfit spun off in December. Mouney described it as a "sister company," although, unlike IT-Omics, it is not a separate corporate entity. CardiAlpha specializes in the scientific and logistical architecture of clinical trials for cardiovascular compounds, operating as a subcontractor for both Genfit and large pharmaceutical companies. It is expected to show a profit as early as this year, thanks to the amount of business it already has picked up.

As for Genfit, it is forecasting a further 34 percent rise in revenues to €8.9 million in 2002.