Signature BioScience Inc. is moving toward drug discovery and fueling the trek with acquisitions.

Hayward, Calif.-based Signature bought Protein Design Labs Inc.’s Small Molecule Group in an all-stock transaction signed Dec. 20 and closed Friday. In roughly the past six months, Signature also has acquired Cambridge, Mass.-based Millennium Pharmaceuticals Inc.’s Cambridge Discovery Chemistry Inc. (in July) and PrimeCyte Inc., of Seattle (this month). (See BioWorld Today, July 17, 2001, and Jan. 9, 2002.)

Although unable to provide financial terms of the latest deal, Jesse Ciccone, Signature’s director of corporate communications, said the assembled additions are blazing a path to a new Signature.

“We wanted to become a drug discovery company, and we’ve made a number of strides in that direction,” he told BioWorld Today. “When it came out that [Protein Design Labs] was divesting this group, we decided this is a group of experienced screeners, biologists and chemists, which are all needs for us. We thought we could integrate them with our own organization.”

Although Protein Design Lab’s senior executives were on the East Coast, where they rang the bell to start Nasdaq’s trading day and celebrated PDL’s 10th anniversary on Nasdaq and its 15th as a company, Jim Goff, PDL’s senior director of corporate communications, said the selling of the Small Molecule Group reflects PDL’s decision to concentrate on antibodies.

“Our focus is, as it has been, on antibodies, and the divestiture of the Small Molecule Group is consistent with that stated focus,” Goff said, pointing out that the company has seven antibodies in development and a stated goal to bring one to two antibodies into the clinic each year.

The Small Molecule Group was responsible for PDL’s chemistry, high-throughput screening and small-molecule drug discovery research. By bringing it on board, Signature gets up to 14 employees, lab equipment, a compound library and two preclinical lead programs. Ciccone said the new biologists and screeners will move to Hayward, while the chemists will journey to Signature’s facility in Richmond, Calif. However, corporate headquarters will switch from Hayward to downtown San Francisco 475 Brannan, to be exact around Memorial Day.

Privately held Signature’s prime drug discovery technology is WaveScreen, its platform that integrates its spectroscopy technology, called MCS, with assays and chemistries to allow direct access to a range of biologic activities. It can access and evaluate new targets, characterize them, and discover and optimize small molecules with the appropriate activity against them.

Ways for Signature to expand and improve WaveScreen have come through acquisition recently, including the Small Molecule Group pickup, which should not be surprising. Ciccone said Signature has “a strategic acquisition growth strategy.” And there could be more ahead, he said, adding that Signature will “continue to evaluate acquisitions that make sense.”

Signature has more than 130 employees now, including the 25 synthetic chemists it netted through the CDC acquisition, the five it gained from acquiring PrimeCyte and the potential 14 it will get from the Small Molecule Group.

Besides adding to WaveScreen, the acquisitions have given Signature a pipeline. It received PC4071 from PrimeCyte, and the product is now in Phase IIa studies, one for ovarian cancer and one for soft-tissue sarcoma, Ciccone said. Through PrimeCyte’s preclinical platform, Ciccone said there is the potential for up to 50 lead compounds. Also, there are the two preclinical lead programs from the Small Molecule Group.

“We’ve made big strides in the last year,” Ciccone said. “And we have really transferred from what was a tools/instrument company into a drug discovery organization.”

PDL’s stock (NASDAQ:PDLI) rose 31 cents Wednesday to close at $22.21.