GTG signs two deals with Applera spin-off MetaMorphix

Genetic Technologies (ASX:GTG) has reached two agreements with US animal genomics company MetaMorphix over the use of GTG's non-coding DNA patents and access to technology developed by MetaMorphix.

The agreement may lend more weight to GTG's legal wrangle with Applera -- MetaMorphix is an Applera spin-off, and Applera holds a major shareholding in the company. Much of MetaMorphix's technology had its origins in the larger company.

"If MetaMorphix needs a licence for what it got from Applera, then perhaps Applera needs a licence too. One could argue that it's quite relevant," GTG executive chairman Mervyn Jacobson told Australian Biotechnology News.

One agreement, worth a total of AUD$1.8 million to GTG in fees and annual payments over the next 11 years, provides MetaMorphix with a non-exclusive, world-wide licence to use GTG's non-coding DNA patents for applications in livestock, aquaculture and companion animals.

The second agreement covers a licence granted to GTG by MetaMorphix and its subsidiary MMI Genomics for a broad range of diagnostic assays and testing rights for cattle and dogs. The licence provides GTG with exclusive rights in Australia and New Zealand and non-exclusive rights in Asia.

According to Jacobson, the licence will allow GTG to expand its dog testing service, which includes paternity testing, pedigree verification and testing for both desirable and non-desirable genetic traits such as hip dysplasia. "We're currently in negotiations with kennel clubs over this service," he said.

Similar services are being developed for cattle, particularly in the emerging market for high quality dairy cattle in China, Jacobson said. Earlier this year Jacobson became the chief technology officer for the scientific advisory board of the China National Animal Breeding Stock Export/Import Corporation, which is seeking to improve health and efficiency of livestock production in China.

"Other markets fade into insignificance when compared to the urgent need of China to improve the quality of its dairy herds," he said. "Having these rights from MetaMorphix gives us increasing firepower in putting this together."

Jacobson said that the exclusive rights in the Australian and New Zealand markets would also be important, particularly in New Zealand where the company has been competing with others for access to MetaMorphix's technology. These groups would have to access the tests through GTG, he said.