Pfizer Inc has made a $50 million equity investment in Perlegen Sciences Inc, taking a twelve per cent position in the private biotechnology company.

Pfizer and Perlegen entered into their first research collaboration in December 2002, using Perlegen's DNA sample preparation, high resolution SNP genotyping, and data analysis capabilities to discover genes associated with common diseases and identify genetic markers that may predict patient response to medicines.

Under the terms of this investment transaction, Pfizer has purchased $50 million of preferred stock in Perlegen. With this investment, Pfizer joins Affymetrix, Maverick Capital, CSK Ventures, Eli Lilly and a number of other institutional and private investors in taking a significant ownership interest in Perlegen, informs a company release.

"We all recognise the challenges and risks that drug discovery and development poise. Industry-wide, many new drugs have been discontinued in late-stage trials, after hundreds of millions of dollars have been invested. Many times this results because a subset of patients responded differently from the rest," said Brad Margus, co-founder and chief executive officer of Perlegen.

"As recent events have shown, even FDA-approved, marketed drugs can run into problems when a small number of patients have an unexpected response. Perlegen's comprehensive understanding of the genetic heterogeneity of human disease as well as our pharmacogenomics approach, searching for genetic markers that can be used to predict patient response, may address this enormous challenge. Drugs developed based on genetic information will be directed more specifically towards the patients who are most likely to benefit from them," added Margus.

"We recognise that many diseases we aim to treat have a strong genetic component. Additionally, we know some patients taking medicines show efficacy or experience side-effects, while others do not. Our understanding of all this has improved greatly but these areas remain as significant challenges in drug development," said John LaMattina, senior vice president, Pfizer global research and development at Pfizer.

Perlegen Sciences Inc. analyses millions of unique genetic variations in DNA samples obtained from clinical trial participants. This information is used to explain and predict the efficacy and adverse effect profiles of prescription drugs. Perlegen also applies this expertise to discovering genetic variations associated with disease for potential new therapeutics and diagnostics.