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Biotech / Medical : Sequana -- Ignore unavailable to you. Want to Upgrade?

To: Boyce Burge who wrote (316)	11/4/1997 2:12:00 AM
From: CYBERKEN	Read Replies (3) \| Respond to of 337

Before voting no I'd consider the resulting fundamentals. New co will have plenty of cash, as well as potential increased leverage in new partnerships. I agree, though, that the resultant synergies will have to materialize. Seems like a question of "merging corporate cultures" that has popped up on other threads. IMO:good mgt can create positive "corporate culture merging" with shrewed combination of stock options and pink slips. Both former and latter tend to create lots of "exitement" internally.

To: Boyce Burge who wrote (316)	11/4/1997 7:25:00 AM
From: tonyt	Respond to of 337

LOS ANGELES, Nov 3 (Reuters) - The expansive field of gene research got a little more focused Monday when two small biotech companies agreed to merge and work jointly to develop new disease treatments based on gene discoveries. Drug development company Arris Pharmaceutical Corp said it would buy Sequana Therapeutics Inc (NASDAQ:SQNA), which identifies genes associated with human diseases. The merger created one of the first biotechnology companies to have "capabilities extending from gene-to-drug," the companies said. Part of the problem is that the companies like Sequana that have the expertise to identify different genes are not the same ones that know how to actually make drugs. "It's really critical to integrate the two," said Mehta and Isaly analyst Edmund Debler, who called the merger of Arris and Sequana a "text book example of vertical integration." "They're combining a company that has a technology to provide information with one that moves it further along the way to finding a drug candidate." While the combination moves research efforts along, it does not guarantee any successful new drugs will result. Most drug companies have already invested in the burgeoning field of "genomics," which is widely seen as the wave of the future in disease prevention and treatment. But the field has also been criticized recently for its lofty promises and failure to follow through. Although researchers have located many genes found to cause different forms of cancer and other deadly diseases, they have not yet come up with any treatments based on these findings. A woman may be tested to see if she has one of the genes linked to breast cancer, but if the test comes back positive, she has few good options to prevent the cancer from appearing. Arris has demonstrated some know-how in developing compounds that counteract diseases, but it has not yet brought any of its drug candidates to market. And developing gene therapies has proven to be particularly challenging. It requires not only a compound that works in the lab, but a precise delivery mechanism to bring the treatment to the targeted part of a cell's DNA. "Our chemistry expertise picks up where Sequana's target identification leaves off," said Arris chief financial officer Fred Ruegsegger. Of an estimated 100,000 human genes, experts believe about 10,000 are potential targets for some type of pharmaceutical intervention, Ruegsegger said. "It is very feasible that a majority of the new drug discoveries will be genomics-based within 10 years," said Debler. But he added that Arris and Sequana still needed to demonstrate their ability to effectively combine resources. One of the biggest hurdles, he said, was simply sifting through the volumes of new data that are coming out of genetic research. "I think (the merger) has great potential to be a long-term builder of value, but it's not a slam dunk by any means." "If you can, imagine trying to read all of the 8,000 or so newspapers and magazines that are published on the Internet. Genomics is worse than that." Copyright 1997, Reuters News Service