SYDNEY, Australia - Amrad Corp. Ltd. signed a deal potentially worth up to US$16 million for Ares-Serono International to develop an infertility treatment from intellectual property held by Amrad.

Melbourne-based Amrad said it had licensed certain patent rights and technology involving its recombinant LIF (leukemia inhibitory factor) to Ares-Serono, of Geneva, Switzerland. Amrad is now testing an injectable formulation of LIF, generally referred to by AM424, as a treatment for the nerve and muscle side effects of chemotherapy. Ares-Serono intends to develop a LIF treatment in the form of a gel for direct application into the reproductive tract.

Amrad director of pharmaceutical research and development, John Flack, said it is very hard to make assessments of the chances of an infertility treatment based on LIF reaching the market, but said the chances could be 50-50.

A LIF treatment already has several factors working in its favor, including the fact that Amrad has the nerve and muscle treatment formulation into Phase II testing and the compound is known to be stable. Also, in animal experiments, an absence of LIF in the reproductive tract is associated with the embryo failing to attach itself to the uterus wall, he said.

Amrad said a growing body of experimental and clinical data suggests a possible role for LIF in the process of embryo implantation.

Silvano Fumero, senior executive vice president, research and pharmaceutical development at Ares-Serono, said, "The causes of female infertility are multiple and in many cases difficult to ascertain. Embryo implantation is one of the major causes of pregnancy failure. Addressing embryo implantation by the administration of an exogenous agent is a novel approach in assisted reproductive technology."

As part of the agreement, Ares-Serono made an undisclosed up-front payment to Amrad. The agreement states that if the treatment meets all research milestones then Amrad will receive total payments of US$16 million, plus royalties from the sale of any product. Flack noted that if all went well the product could commercialized in four or five years.

As part of the deal Amrad will manufacture the LIF for Ares-Serono's development work. LIF was discovered at the Walter and Eliza Hall Research Institute in Melbourne.