Japanese drugmaker Fujisawa Pharmaceutical announced yesterday that it is expanding cooperation with the Israeli firm Quark Biotech, Inc. in developing medications for stroke victims.

The cooperation is based on QBI's technological and scientific capabilities and Fujisawa's financing.

QBI and Fujisawa have already cooperated in searching for genes that could be related to strokes, and that could therefore be targeted when developing therapies to protect neurons, and to improve post-trauma recovery.

The companies have discovered chemicals that trigger reactions in genes connected with strokes and used them to create molecules that should depress the genetic activity.

The molecules are now undergoing animal testing and toxicity trials. The alliance will cover the clinical trial stage of development.

QBI CEO Daniel Zurr said yesterday that the new agreement will focus in particular on post-stroke recovery. QBI will receive marketing rights in the U.S. and Europe for some of the medications that are being developed.

The agreement brings QBI forward from the gene-location stage - searching for genes that cause stroke - to developing drugs that depress those genes. The company predicted yesterday that this transition to drug development will require new fundraising in the course of 2003.

Zurr said the company will consider an initial public offering on Nasdaq in 2003 if market conditions are favorable. In a financing round conducted in 2001, QBI was assessed at $400 million.

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