Halozyme Therapeutics, Inc. and Roche have entered into an agreement to apply Halozyme's proprietary Enhanze Technology to Roche's biological therapeutic compounds.

Enhanze Technology is Halozyme's proprietary drug delivery technology based on its recombinant human hyaluronidase (rHuPH20). rHuPH20 is an analogue of a human enzyme that temporarily clears space in the matrix of tissues such as skin. This clearing activity should allow rHuPH20 to improve drug delivery by enhancing the entry of therapeutic molecules through the subcutaneous space.

"Roche is a global leader in the development of biologics and we are excited to be applying our rHuPH20 technology to this area with Roche compounds," said Jonathan Lim, MD, Halozyme's president and CEO. "We believe that our technology can enhance the clinical benefits that biologics have already been shown to provide. In every respect, both technically and commercially, this represents a landmark agreement for Enhanze Technology and for Halozyme."

"We are looking forward to working together with Halozyme using their rHuPH20 technology," said Peter Hug, Roche's Global Head of Pharma Partnering. "The potential to improve the administration and bioavailability of subcutaneous medicines presents an important advance to make a difference to patients' lives."

Halozyme Roche collaboration under the terms of the agreement, Roche will pay Halozyme $20 million as an initial upfront payment for the application of rHuPH20 to three pre-defined Roche biologic targets. Roche will also have the option to exclusively develop and commercialize rHuPH20 with an additional ten targets.

Pending the successful completion of a series of clinical, regulatory, and sales events, Roche may pay Halozyme further milestones which could potentially reach a value of up to $111 million as well as royalties on potential product sales for the first three targets.

For each of the additional ten targets, Roche may pay Halozyme further upfront and milestone payments of up to $47 million per target. In addition, the Roche Venture Fund will make an $11 million equity investment, representing approximately 5 per cent of Halozyme's outstanding common stock.

Under the collaboration, Roche will also obtain access to Halozyme's expertise in developing and applying rHuPH20 to Roche targets. Roche will obtain a worldwide, exclusive license to develop and commercialize product combinations of rHuPH20 and Roche target compounds resulting from the collaboration.

Enhanze Technology is Halozyme's proprietary drug delivery technology based on recombinant human hyaluronidase (rHuPH20), a recombinant form of the naturally occurring human enzyme approved by FDA for its ability to break down hyaluronic acid (HA), the space-filling gel-like substance that is a major component of tissues throughout the body.

When combined or coformulated with certain injectable drugs, Enhanze Technology can act as a molecular machete to facilitate the penetration and dispersion of these drugs by temporarily opening flow channels under the skin. Molecules as large as 200 nanometers may pass freely through the perforated extracellular matrix, which recovers its normal density within approximately 24 hours, leading to a drug delivery platform which does not permanently alter the architecture of the skin.

Headquartered in Basel, Switzerland, Roche is one of the world's leading research-focused healthcare groups in the fields of pharmaceuticals and diagnostics. As a supplier of innovative products and services for the early detection, prevention, diagnosis and treatment of disease, the Group contributes on a broad range of fronts to improving people's health and quality of life. Roche is a world leader in diagnostics, a leading supplier of medicines for cancer and transplantation and a market leader in virology. In 2005 sales by the Pharmaceuticals Division totalled 27.3 billion Swiss francs, and the Diagnostics Division posted sales of 8.2 billion Swiss francs. Roche employs roughly 70,000 people in 150 countries and has R&D agreements and strategic alliances with numerous partners, including majority ownership interests in Genentech and Chugai.

The Roche Venture Fund advises Roche on investments in early stage biotech and diagnostics companies to support innovative technologies and medicines. Based in Basel, Switzerland, the Roche Venture Fund manages a portfolio of over 25 companies in 10 countries.

Halozyme is a biopharmaceutical company developing and commercializing recombinant human enzymes for the drug delivery, palliative care, oncology, and infertility markets. The company's portfolio of products is based on intellectual property covering the family of human enzymes known as hyaluronidases. Halozyme's recombinant human enzymes may replace current animal slaughterhouse-derived extracts that carry potential risks of animal pathogen transmission and immunogenicity. The company has received FDA approval for two products: Cumulase, the first and only recombinant human hyaluronidase for cumulus removal in the IVF process; and Hylenex for use as an adjuvant to increase the absorption and dispersion of other injected drugs. The versatility of the first enzyme, rHuPH20, enables Halozyme to develop the product as a medical device, drug enhancement agent, and therapeutic drug.