Zacharon Nabs $210M Deal With Pfizer to Tackle Orphan Diseases

Xconomy San Diego — 

San Diego-based Zacharon Pharmaceuticals just struck its first really big partnership. The company, backed by Avalon Ventures, said today it has formed an alliance with New York-based Pfizer that could be worth as much as $210 million to develop drugs for rare diseases.

Specific financial terms weren’t provided in today’s statement, but Zacharon will get upfront payments, R&D funding, plus milestones and royalties on future product sales from the collaboration. Pfizer (NYSE: PFE) is essentially paying for Zacharon’s expertise at making conventional small-molecule drugs that interact with complex carbohydrates known as glycans, which are thought to be promising drug targets for rare diseases, including lysosomal storage disorders. For more on the company and its approach, check this profile I wrote in December 2008.

For the non-scientists in the audience who want to skip to the punch line, treatment of lysosomal storage disorders are the stuff that made Cambridge, MA-based Genzyme (NASDAQ: GENZ) a multi-billion dollar biotech giant. One of Pfizer’s rivals, Paris-based Sanofi-Aventis, made a huge move into this particular field of rare disease treatment earlier this year through its $20 billion acquisition of Genzyme.

Zacharon, of course, is many years away from getting products on the market, and may never get there. But the money and validation from Pfizer certainly provide a healthy boost along the way.

“We are very pleased to be working with Pfizer, which has broad compound development expertise, including in the area of small molecules, which should be quite useful to developing drugs for these orphan diseases,” said Robin Jackman, president and CEO of Zacharon, in a statement. “The collaboration provides validation for the potential that lies in Zacharon’s broadly applicable technology platform.”