Tuesday, Mar 3, 1992

Genentech Enters International Commercial Development and Marketing Agreement with Roche for DNase

Three separate R&D agreements also reached with Roche

South San Francisco, Calif. -- March 3, 1992 --

Genentech, Inc. (NYSE: GNE) today announced a collaborative agreement with F. Hoffmann-La Roche Ltd., Basel, a subsidiary of Swiss-based Roche Holding Ltd., for the international development and promotion of DNase, Genentech's recombinant drug which is currently being evaluated in both the United States and Europe as a potential treatment for cystic fibrosis and chronic bronchitis. Within this agreement, Genentech Europe, a European subsidiary wholly-owned by Genentech, will be established using DNase as its first product, and benefiting from the combined resources of the two companies. Three separate R&D collaborations with Roche were also signed.

"The DNase agreement is aimed at expediting the approval and ensuring the international sales success of DNase while establishing a viable Genentech presence in Europe," says G. Kirk Raab, president and chief executive officer of Genentech, Inc. Among the plans is the development of a Genentech European sales force which will have major emphasis on the promotion of DNase for cystic fibrosis. Roche will support these efforts and will assume the lead promotional role for the chronic bronchitis indication. "This agreement will capitalize on the strength Genentech has reached in product development and hospital-based sales for recombinant therapies and Roche's prominence in the pharmaceutical business throughout the world," explains Raab. Genentech Europe will also benefit from the European regulatory expertise of Roche, expecting to file for a cystic fibrosis claim in early 1993.

"This arrangement typifies the kind of collaboration between Genentech and Roche which we have been building toward since our investment in September 1990," says Armin M. Kessler, chief operating officer, F. Hoffmann-La Roche Ltd. "Roche is well positioned to support the approval and marketing of what we believe is an innovative and important new therapeutic."The agreement calls for the collaborative clinical development, registration and marketing of DNase in all major countries of Europe. The length of the agreement is ten years from approval of the first indication received in each European country involved in the collaboration. Genentech will supply product and receive milestone payments and technical support from Roche. The two companies will share the development, marketing and selling costs as well as the profits in this region. Genentech has also granted Roche an exclusive royalty-based license for countries outside Europe, the United States, Canada and Japan under a common Genentech trademark.Genentech Europe will be headed by a Genentech vice president and managing director, to be named at a later date. Three separate R&D collaborations with Roche also set in motion.

Roche and Genentech have also agreed on three important research and development collaborations. According to Professor Jurgen Drews, M.D., president of International R&D and a member of the Executive Committee at Roche, "The R&D agreements offer scientific and potential development synergies that should achieve attractive commercial benefits for both companies." Products discovered or developed through the three R&D collaborations would be shared between Genentech and Roche.

1.Small Molecule Screening

The first collaborative arrangement affords Genentech the opportunity to screen Roche's extensive chemical libraries of small molecules, seeking to identify compounds that demonstrate potential therapeutic or prophylactic benefit in humans. Genentech's molecular biology-based drug discovery expertise and automated assays would be used for screening purposes. Roche's expertise in chemical and biological optimization of compounds would be used in the research and development of candidate compounds identified in the Genentech assays.

2.TNF-receptor collaboration

The second R&D agreement commits Genentech's process development and manufacturing capability to produce a TNF receptor-immunoglobulin fusion protein (recombinant protein constructed by a fusion of tumor necrosis factor receptor and immunoglobulin sequences) being studied by Roche and Genentech for use in septic shock. It also provides Genentech the option to participate in certain commercial opportunities. Eventually, Genentech will scale up manufacturing to provide final material for Roche's and Genentech's requirements for commercial sale.

3.Anti-IgE monoclonal antibody collaboration

Both Genentech and Roche have R&D programs in the allergy field, specifically in the area of inhibition of IgE (immunoglobulin E). This new collaboration agreement teams the two company's unique strengths -- Genentech's in molecular biology and development of protein pharmaceuticals, and Roche's in the development of orally-active small molecules. Through collaborative R&D, both companies envision more rapid development and broader commercialization of these important therapeutics. The terms facilitate integrated research, but also assure each company's right to pursue certain independent research in the field.

"The TNF receptor and anti-IgE monoclonal antibody collaborations specifically help Genentech's scientific pursuit of therapeutics in the area of immunology -- one of the four major targets of our current research portfolio, whereas the small molecule screening may open the door to exciting new opportunities for both companies," says Art Levinson, vice president, research, at Genentech.

Genentech has previously stated its intent to concentrate major research efforts in the areas of cardiovascular, immunology, endocrinology and neurobiology disorders, while maintaining smaller programs in a variety of other areas. "Toward this end, and in view of Roche's scientific strength, these collaborations complement and reinforce our in-house programs, and may give us an edge in accelerating the pace of future progress," explains Levinson.

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