Swiss drugmaker Roche Holding AG is collaborating with New York-based biotech startup Lodo Therapeutics Corp. to discover natural products directly from the microbial DNA sequence information contained in soil.
Lodo will receive an undisclosed up-front payment and could receive milestone payments up to $969 million. Lodo is also eligible to receive tiered-royalties on sales of certain products resulting from the partnership.
Roche's California-based unit Genentech Inc. will use Lodo's proprietary genome mining and biosynthetic cluster assembly platform to identify molecules with therapeutic potential against multiple disease-related targets.
Lodo said the gene-based approach is expected to reduce the time and cost of drug discovery.
Instead of culturing known strains of bacteria in the laboratory, the companies will look for natural products in soil that comprise a significant proportion of the small molecule drugs used to treat cancer, infections and chronic illnesses such as type 2 diabetes.