BioWorld International Correspondent
LONDON - Veteran Australian antibody specialist Peptech Ltd. is adding a listing on London's Alternative Investment Market (AIM) to its membership of the Australian Stock Exchange, to increase its profile in Europe and attract institutions to invest in the company.
At the same time, Peptech is setting up an R&D base in London and looking for antibody products and companies to acquire in Europe.
There are no immediate plans to raise money through the AIM listing, though the company might do so next year, John Chiplin, CEO, told BioWorld International. "We don't have many institutions in Peptech. I was appointed CEO to internationalize the company and believe AIM is the way to increase our international profile and attract institutional investors."
Sydney-based Peptech was founded in 1985 and joined the Australian Stock Exchange in 1986. The company has been profitable for the past two years on the back of patents it holds on anti-tumor necrosis factor antibodies, receiving royalties from Johnson & Johnson subsidiary Centocor Inc. on sales of Remicade, and from Abbott Laboratories on Humira. It expects income from those two licenses to be between A$100 million (US$77.9 million) to A$130 million in total up to August 2010.
Although Peptech discovered the anti-TNF antibodies in the late 1980s, it was not involved directly in the clinical development of the first-generation products. Indeed, Centocor discovered the antibodies independently, but Peptech was able to claim prior art.
Instead, Peptech is better known for its implants for controlling fertility in animals and has two marketed products, Suprelorin, for the temporary sterilization of dogs, and Ovuplant, for controlling ovulation in mares.
The company is a founding investor of Cambridge Antibody Technology Group plc, now a subsidiary of AstraZeneca plc, of London. It is also a founding investor in Domantis plc, of Cambridge, UK, which is developing domain antibodies, (dAbs), the smallest functional units of antibodies, weighing in at 90 percent less than antibodies and with the ability to hit intracellular targets.
Peptech is the largest investor in Domantis, with a 30 percent holding. The dAb company has expressed ambition to join Nasdaq in 2007, and Chiplin said he will consider whether to divest Peptech's interest when and if that happens.
Following the AIM listing, Chiplin intends to divest the animal health products to focus, belatedly, on clinical development of antibodies and dAbs.
The lead product, PMX53, a C5aR antagonist for treating the wet form of age-related macular degeneration, has completed Phase I. Following behind that are two anti-TNF alpha products due to enter Phase I in 2007. The most advanced, PN0621, a dAb in-licensed from Domantis, should be the first domain antibody to reach the clinic.
"This will be a breakthrough for dAbs," said Chiplin. "The preclinical results are very good, with good anti-TNF activity, and production levels that make the product a lot cheaper than monoclonal antibodies against TNF."
Peptech's aim is that PN0621 will reach the market in 2011, the year after the TNF antibody royalties run out.
In addition, Peptech has established a joint venture with Australian neighbor, Biosceptre International Ltd., to develop antibody and dAb-based cancer diagnostics directed at a novel cancer marker present in nearly all types of cancer cells.
Through the joint venture, Peptech hopes to diversify its antibody interests beyond the anti-inflammatory space. There are five products being developed that target the theranostic market.
In the year ended September 2006, Peptech had revenues of A$24.8 million and a profit of A$5.1 million. As clinical development ramped up, R&D expenditure rose by 108 percent to A$8.8 million. The company's market capitalization through its Australian Stock Exchange listing stands at around A$200 million.