Valentis Inc and Schering AG, Germany have signed a multi-product license and option agreement to develop and commercialize gene-based therapeutic products. Under terms of the agreement Schering will obtain exclusive, world-wide rights to Valentis' PINC polymer based synthetic gene delivery and the GeneSwitch gene regulation technologies for use with up to two genes proprietary to Schering, and an option for non-exclusive rights to the PINC technology for a third gene. Schering will make an initial payment of $1.1 million in cash to Valentis in license and option fees. Additional financial details were not disclosed.

"Valentis brings us unique technologies in gene delivery and gene expression regulation which we intend to use for the creation of new innovative gene-based therapeutics," stated Dr Joachim-Friedrich Kapp, Head of Specialized Therapeutics at Schering Group. "We are glad to expand our activities in gene therapy with this project following our recent acquisition of Collateral Therapeutics."

"We are pleased to have the opportunity to work with Schering AG, because of their clear commitment to the field of gene-based therapeutics," stated Dr. Benjamin F. McGraw, III, President and Chief Executive Officer of Valentis.

Valentis has three product platforms for the development of novel therapeutics: the GeneMedicine, GeneSwitch and DNA vaccine platforms. The GeneMedicine platform includes a comprehensive array of proprietary nucleic acid delivery systems, including the broad cationic lipid portfolio, from which appropriate formulations and modalities may be selected and tailored to fit selected genes, indications, and target tissues. The del-1 GeneMedicine therapeutic is the lead product for the GeneMedicine platform of non-viral gene delivery technologies. Del-1 is an angiogenesis gene that is being developed for peripheral arterial disease and ischemic heart disease. The EpoSwitch therapeutic for anemia is the lead product for the GeneSwitch platform and is being developed to allow control of erythropoietin protein production from an injected gene by an orally administered drug. We have developed synthetic DNA vaccine delivery systems based on several classes of polymers, which we intend to exploit via licensing. Our proprietary PINC polymer-based delivery technologies for intramuscular DNA administration potentially provides for higher and more consistent levels of antigen production.