Genzyme Corp has inked a $100 million development deal with a New Jersey biopharmaceutical company to develop and sell a new treatment for genetic diseases.

Cambridge, Massachusetts-based Genzyme, which has a genetics laboratory in Santa Fe, said on Thursday it would collaborate with PTC Therapeutics on PTC's drug PTC124. The treatment is being tested in separate mid-stage human clinical trials for a form of muscular dystrophy and cystic fibrosis.

Under the terms of the agreement, PTC will commercialise PTC124 in the US and Canada, and Genzyme will commercialise the treatment in all other countries. Genzyme will make an up-front payment of $100 million to PTC, plus potential milestone and royalty payments. PTC will be financially responsible for one ongoing and three additional clinical trials of PTC124, which is potentially applicable to hundreds of genetic diseases.

PTC is eligible to receive up to $337 million in total milestone payments, as follows - up to $165 million in development and approval milestones, the majority of which are to be paid upon approvals in Genzyme territories; and up to $172 million in sales milestones, contingent upon the achievement of specific sales levels. The sales milestone payments begin when annual net revenues reach $300 million, and increase in increments through revenues of $2.4 billion.

PTC is also eligible to receive tiered double-digit royalties from sales in Genzyme territories.

PTC124 is an orally delivered, investigational new small molecule drug for the treatment of genetic disorders due to nonsense mutations. Nonsense mutations are single-point alterations in the genetic code that prematurely stop the translation process, preventing production of a full-length, functional protein.

In phase 2a clinical trials in nonsense-mutation-mediated cystic fibrosis and in nonsense-mutation-mediated Duchenne muscular dystrophy (DMD), PTC124 has demonstrated the ability to produce functional protein across a variety of nonsense mutation types.

Across all clinical studies to date, PTC124 has been generally well tolerated and has achieved target plasma concentrations associated with activity in preclinical models. PTC124 is currently in phase 2b development with the goal of demonstrating that increasing functional protein levels in patients with nonsense-mediated genetic disorders will provide clinical benefits.

"Over the past two decades, Genzyme has successfully developed four therapies for patients with severe genetic diseases. PTC124 is a powerful new approach that holds great potential to help CF and DMD patients, and many others with a variety of devastating diseases," stated Henri A Termeer, Genzyme's chairman and CEO. "This collaboration is an excellent strategic fit for Genzyme and will be managed within the company's stated financial guidance."

"One of PTC's earliest scientific insights was that targeting nonsense mutations represented a novel approach to treating a large number of genetic disorders. The translation of that insight through the discovery and rapid development of PTC124 has been very gratifying," commented Stuart W Peltz, PTC's president and CEO.

"This collaboration supports PTC's business strategy of establishing a fully integrated biopharmaceutical company by retaining commercial rights in the United States and Canada while engaging an experienced and capable partner to swiftly address additional markets," he added.

Genzyme Corporation is a biotechnology company based in Cambridge, Massachusetts. Genzyme is the world's third biggest biotechnology company employing over 9,000 people around the world. At present, the company has approximately 80 locations in 40 countries. It includes 17 manufacturing facilities and 9 genetic testing laboratories.

The company's products are available in nearly 90 countries. In 2007, Genzyme generated $3.8 billion in revenues with more than 25 products in the world's markets. The company is also involved in philanthropic acts, donating $83 million in global product donations and $11 million in cash contributions in 2006.

In 2006 and 2007 Genzyme was named one of Fortune Magazine's ''100 Best Companies to Work for.'' Additionally in 2007, Genzyme was awarded the National Medal of Technology, the highest level of honour awarded by the President of the United States to America's leading innovators.