Cholesterol and palmitoyl-modification of Hh-Np render the ligand highly hydrophobic and results in its close association with the plasma membrane of the producing cell after secretion. Hh-Np tethered in this way may cluster in sterol-rich lipid rafts where it is competent for short-range signaling. Cell surface Hh-Np also interacts with glypican components of the extracellular matrix and this interaction stabilizes the ligand and is required for its lateral spread. Together, clustering into lipid rafts and interaction with HSPGs may favour packaging of ligand into higher order forms required for ligand dispersal.
Long-range signaling requires release of Hh-Np from the secreting cell. Release is achieved through a number of possibly overlapping mechanisms. These include oligomerization into micelle-like structures, packaging into lipoprotein particles and interaction with cholesterol-binding adaptor proteins such as DISP and SCUBE2. In addition, Hh-Np can be released from the plasma membrane through proteolytic cleavage: NOTUM is a secreted enzyme that is thought to promote the release of Hh-Np by cleaving the GPI anchor of Hh-associated glypicans, while the transmembrane metalloprotease ADAM17 promotes long-range Hh signaling by removing the palmitoyl- and cholesterol-modified N- and C-termini of the membrane-associated ligand. How all these mechanisms are coordinated remains to be elucidated (reviewed in Briscoe and Therond, 2013; Gallet, 2011).