Arrowhead Research Corp. has inked another technology deal with Caltech this time betting on a high-tech sugar molecule.

The Pasadena-based company formed its Calando Pharmaceuticals subsidiary last month after licensing a Caltech-developed method of providing gene-based therapy to treat diseases.

The technique involves so-called RNA interference, in which altered RNA is infused into genes associated with various conditions cancer or autoimmune diseases, for instance to silence them.

The licensed technology uses a modified sugar molecule to deliver the modified RNA to the genes.

"A lot of companies have figured out how to turn off those genes, but they are having trouble delivering it to the right place," said R. Bruce Stewart, president of Arrowhead.

Caltech, which is taking an equity stake in the subsidiary, has granted Arrowhead exclusive rights to 180 patents and patent applications, largely in the field of nanotechnology.

Also taking equity stakes are scientific founders Mark Davis, a Caltech chemical engineer who developed the delivery technology, and John Rossi, a City of Hope molecular biologist and RNA interference researcher.

Arrowhead has raised $12.5 million in two private placements to fund sponsored research at Caltech. So far, none of the research has yielded revenues.

Sales Growth

Once-faltering medical device maker IRIS International Inc. continues to show strong earnings and revenue growth, thanks to its flagship product an advanced urinalysis device that was introduced in August 2003.

At $125,000 each, the new iQ200 machines are about $50,000 cheaper than an earlier model, and feature added automation. That has broadened IRIS' market from an existing base of 700 large hospitals and laboratories to about 2,400. And in a little over a year, IRIS has placed more than 300 of them, compared with 400 altogether for the older machine.

Last week, Chatsworth-based IRIS reported fourth-quarter net income of $830,000, compared with $80,000 for the like period a year earlier. Sales rose to $12.2 million from $10.3 million a year earlier.

Scarlet List

Employers planning to cut health coverage, beware. A bill introduced by Assemblyman Jerome Horton, D-Inglewood, would require applicants to Medi-Cal, Healthy Families and other government health programs to list their employers, if top a threshold of 25 beneficiaries.

The bill, AB 89, would require the state Department of Health Services and another agency to compile this information and make it available to the public a sort of Scarlet Letter for businesses that aren't providing health care.

"We want to be able to show that these companies posted profits and yet a percentage of their employees are on state-funded health care, which is not fair," said Alma Hernandez, a legislative aide to Horton.

Staff reporter Laurence Darmiento can be reached at (323) 549-5225, ext. 237, or at .

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