UPDATE 1-GE, J&J deal pairs two Alzheimer's powerhouses

* Companies hope to find way to diagnose disease early

* Both have compounds in late-stage clinical trials

* Pact follows Lilly's deal to buy Avid for up to $800m

By Julie Steenhuysen

CHICAGO, Dec 1 (Reuters) - GE Healthcare (GE.N) and Johnson & Johnson (JNJ.N) are teaming up to look for early signs of Alzheimer's disease in a research pact that pairs one of the most advanced imaging agents for Alzheimer's with one of the most advanced drugs being tested.

The companies said on Wednesday the deal is meant to advance efforts to find biological signals to detect Alzheimer's disease at an earlier stage, when experts think drugs will have the best chance of making a difference.

"The collaboration we are announcing today is part of this effort to understand Alzheimer's," Pascale Witz, president and chief executive of medical diagnostics at GE Healthcare, said in a statement. The value of the deal between the unit of General Electric and J&J's Janssen division was undisclosed.

Witz said the companies will be looking for a biosignature -- a collection of biological markers that identify people who are just beginning to develop the disease.

This will allow doctors to diagnose the disease earlier, but it might also accelerate the development of new drugs to treat Alzheimer's, a fatal, mind-robbing disease that affects 26 million people.

GE is already in late-stage human testing with an imaging compound called Flutemetamol that can be used with its positron emission tomography or PET scanners to identify beta amyloid, a protein that forms clumps in the brains of people with Alzheimer's.

Researchers think amyloid may begin accumulating in the brain decades before people with disease show symptoms.

IMAGING RACE

GE has been in a race with Avid Radiopharmaceuticals to develop an amyloid imaging agent, and its pact with the big U.S.-based drug company follows Eli Lilly and Co's (LLY.N) deal last month to buy Avid for up to $800 million. [ID:nN10137865] [ID:nN08203115]

GE and Germany's Bayer (BAYGn.DE) are both developing similar radioactive tracers that light up beta amyloid, and both compounds are in late-stage trials. [ID:nLDE6A71XG]

Both GE and J&J stressed in statements that their deal will focus on combinations of biomarkers or biosignatures, including beta amyloid and possibly tau, a protein that forms toxic tangles in the brains of people with Alzheimer's.

"The underlying pathologies associated with Alzheimer's disease, such as the formation of amyloid plaques and tau tangles in the tissues of the brain, can precede the onset of memory loss and other clinical symptoms by decades," Dr. Husseini Manji, J&J's global head of neuroscience research & development, said in a statement.

No drugs can arrest Alzheimer's, and most tested so far have failed, in large part, some experts believe, because they were tried in people whose brains were already too far gone.

In August, Lilly halted development of its Alzheimer's drug semagacestat after it worsened patients' symptoms in late-stage studies. [ID:nN17120793].

J&J and Pfizer Inc (PFE.N) are jointly developing a drug called bapineuzumab, now in late-stage trials, but a mid-stage study in 2008 found it could cause brain swelling and the companies have been having trouble getting patients to volunteer.

Worldwide costs to treat dementia are expected to hit $604 billion in 2010, and those costs will soar as the number of sufferers triples by 2050, according to Alzheimer's Disease International.[ID:nLDE68I0IF]

(Editing by Maggie Fox, Dave Zimmerman)