UPDATE 1-Genzyme, PTC join to market genetic disorder drug

(New throughout; adds NEW YORK dateline)

NEW YORK, July 17 (Reuters) - Biotechnology company Genzyme Corp (GENZ.O) will collaborate with PTC Therapeutics to develop and market an experimental drug now in mid-stage clinical testing that could treat hundreds of genetic disorders, Genzyme said on Thursday.

Genzyme will pay $100 million up front to privately held PTC, plus any potential milestone and royalty payments for its drug, PTC124.

PTC is also eligible for a maximum of $337 million in development, approval and sales milestones, Genzyme said. The sales milestone payments begin when annual net revenues reach $300 million.

PTC will commercialize the therapy in the United States and Canada while Genzyme will market PTC124 in all other countries. Genzyme said PTC is eligible to receive tiered, double-digit royalties from sales in Genzyme territories.

PTC will also be responsible for financing one ongoing and three future clinical trials of PTC124.

Clinical testing for PTC124 began in 2004. The drug targets a particular genetic alteration called a "nonsense mutation." The drug is being developed to treat genetic disorders in which the nonsense mutation is the root of the disease.

PTC124 is currently being evaluated in a phase 2b trial for Duchenne muscular dystrophy, the most common form of muscular dystrophy, a genetic, degenerative disease that affects voluntary muscles. There are an estimated 10,000 patients affected in the United States, 13 percent of whom have nonsense mutations.

A phase 2b trial in cystic fibrosis is expected to start by the end of the year. Of the 30,000 U.S. patients with cystic fibrosis, a disease that triggers mucus build-up in the lungs, about 10 percent have these mutations.