June 18 (Reuters) - Swiss drugmaker Roche will

team up with privately held biotech Ascidian Therapeutics to

develop gene therapies targeting difficult to treat neurological

diseases, the Boston-based startup said on Tuesday.

WHY IT'S IMPORTANT

Roche is pursuing several therapeutic fields to offset

falling oncology sales, setting a high deal pace to restore its

development pipeline that was hit by major trial setbacks in

Alzheimer's and cancer immunotherapy in 2022.

Under the agreement, Roche gets exclusive rights to

Ascidian's RNA exon editing technology to develop therapies for

undisclosed neurological diseases.

BY THE NUMBERS

Ascidian will receive an initial payment of $42 million and

up to $1.8 billion in research, clinical, and commercial

milestone payments. It is also eligible to receive royalties on

commercial sales worldwide for any therapies developed under the

partnership.

CONTEXT

Ascidian, backed by venture capital firm Apple Tree

Partners, is separately testing a genetic eye disease therapy in

an early-stage trial. It raised $40 million in its latest

funding round in November 2023.

The therapy candidate, ACDN-01, is also based on its RNA

exon editing technology that involves replacing mutated sections

of genes with healthy ones.

This approach aims to provide long-lasting effect similar to

traditional gene therapy but with reduced risks compared to

direct DNA editing and gene replacement.

KEY QUOTES

"Our partnership with Ascidian is an opportunity to harness

advanced RNA exon editing technology, which has the potential to

deliver transformative one-time therapeutics by editing

multiple whole exons at the RNA level with a single treatment,"

James Sabry, global head of pharma partnering at Roche, said.