- The Washington Times - Tuesday, April 15, 2008

Rockville molecular diagnostics company Celera Group said last week it is developing a gene-silencing technology to treat cancer in partnership with drug maker Merck & Co.

The technology is designed to switch off genes that cause cancers, thereby eliminating the disease at a genetic level.

Merck will gain access to as many as 10 cancer targets in exchange for paying Celera a two-year license fee as well as payments for development and royalties. The companies declined to disclose financial terms of the deal.

They say gene silencing, or RNAi, could offer an alternative to chemotherapy, which destroys healthy tissue as it kills cancer cells.

“This new relationship extends our ongoing therapeutic development collaborations and may lead to the development of tests that have the potential to become part of routine clinical practice in the pursuit of targeted medicine,” said Steven M. Ruben, Celera’s vice president of protein therapeutics. In this role he manages proteomic research, or the study of the structure and function of proteins produced by the body, which can help identify diseases a person might have.

Celera is a competitor in the cutting-edge science of genetic decoding. Its ultimate goal is to develop designer drugs, sometimes known as “targeted medicine.”

As scientists decode the human genome, or genetic code, they say they could design drugs to cure ailments based on the unique structure of each person’s physiology.

In much the way microprocessors have doubled in power every few years, Celera and its competitors are decoding genes at the same pace, raising the possibility of genetic report cards for everyone in about 20 years.

Celera’s stock rose last month after its researchers identified gene variants implicated in vein blood clots, or deep-vein thrombosis. The researchers, in partnership with Leiden University Medical Center in the Netherlands, said the gene variant is found in about half the thrombosis cases.

However, even with about 5,500 employees, Celera officials find they must establish partnerships and make acquisitions to stay on top in their competitive field.

Celera is one of the two business units of Applera Corp. It was founded in 1937 and was formerly known as Celera Genomics Group before changing its name to Celera Group in 2006.

In January 2006, Celera acquired Celera Diagnostics, a joint venture with Applied BioSystems Group.

So far this year, it has acquired Berkeley HeartLab and Atria Genetics for a total price of at least $220 million.

“We expect the company to actively hunt for new opportunities to utilize its tremendous cash position,” wrote Grant Zeng, an industry analyst for investment research firm Zacks.com, in a research note.

Celera’s stock, CRA on the New York Stock Exchange, closed up 16 cents, or about 1 percent yesterday, at $14.80 per share. Its stock value has followed general market trends, selling for around $17 a share in mid-December before plunging to about $13 a share in mid-March.

For the quarter ended Dec. 31, Celera earned $300,000, or break-even per share, compared with a loss of $500,000, or 1 cent per share, a year earlier.

If restructuring and acquisition costs are excluded, the company earned 2 cents per share. Its revenue more than tripled to $40.3 million from $13.2 million.

Stock analysts are generally optimistic for Celera’s shares.

William R. Quirk, research analyst for investment bank Piper Jaffray, said Celera’s revenue in its most-recent quarterly report exceeded his expectations. However, he said the company must navigate through risks such as potential patent litigation and “failure to enter into collaborations or advance the pipeline” of new products.

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