Domain-specific modification of heparan sulfate by Qsulf1 modulates the binding of the bone morphogenetic protein antagonist Noggin

We have reported previously that Noggin is a heparin-binding protein and associates with the cell surface through heparan sulfate proteoglycans, where it remains functional for the binding of bone morphogenetic proteins (BMPs). Here we report that the binding of Noggin to the cell surface is highly selective for heparan sulfate and that specific structural features are required for the interaction. Noggin binds most efficiently to heparin sequences composed of 10 or more monosaccharides; N-, 6-O-, and 2-O-sulfates contribute to this interaction. In addition, we have shown that the developmentally regulated endosulfatase Qsulf1 selectively removes sulfate groups from the 6-O position of sugars within the most highly sulfated S domains of heparan sulfate, whereas 6-O-sulfates in the NA/NS domains are not substrates for the enzyme. The activity of Qsulf1 in cells in culture results in the release of Noggin from the cell surface and a restoration of BMP responsiveness to the cells. This shows that Noggin binds to the S domains of heparan sulfate and provides evidence that, in addition to modulating Wnt signaling in vivo by the release of heparan sulfate bound Wnt, Qsulf1 also modulates BMP signaling by the release of surface-bound Noggin.