BioWorld International Correspondent

LONDON - Proteome Sciences plc explained why partner Biosite Inc. declined to use Proteome's biomarkers in its first stroke diagnostic machine, and gave an optimistic assessment of prospects for commercializing its proteomics markers before the existing cash reserves are exhausted in mid-2005.

Biosite's decision prompted shares in Cobham-based Proteome to fall from £1.09 to 62.25 pence on July 30. They fell further last week to close at 58.5 pence Friday.

CEO Christopher Pearce told BioWorld International the market's reaction to the news was overdone. "Should we have announced it? Yes. But it is a storm in a tea cup. It may be that our markers will find their way onto [Biosite's] first [stroke diagnostic] panel. They will certainly be on subsequent ones."

Pearce added that Proteome has budgeted for a nominal financial contribution from its deal with San Diego-based Biosite. "They are a development partner. They have invested millions of dollars in making antibodies to our markers."

Biosite has been evaluating Proteome's stroke markers for about 18 months, and short-listed a number of them for its first point-of-care panel. Proteome says those markers are highly sensitive and specific for stroke and ischemic attack at very early time points in the disease process.

However, as a point-of-care test, Biosite's diagnostic uses whole blood, and it transpired that Proteome's markers were affected by hemolysis, in which blood cells burst open during sample collection and handling. The issue of hemolysis is well understood in the diagnostics industry, and in central laboratory high-throughput diagnosis (90 percent of the market), serum or plasma is used instead of whole blood to avoid the problem.

"In no shape or form does Biosite's decision affect the value of our stroke markers, because if we don't get them into point of care, we will get them into high-throughput diagnostics, which we have always viewed as being the important area for us," Pearce said.

Biosite is continuing to evaluate other Proteome biomarkers that are not affected by hemolysis.

Proteome has the right to use antibodies developed by Biosite in high-throughput applications of its biomarkers, and Pearce said he expects to do nonexclusive licensing deals with the half-dozen leading high-throughput diagnostics companies. In some cases, negotiations are at an advanced stage, he said.

"We are well funded at the moment and can move quickly into being cash generative," Pearce said. He added that leading diagnostics companies are convinced of the value of proteomics markers in diagnostics, and, beyond that, in opening up new markets for prognostics.

"Very serious economic value will be generated from a new mid-market section of prognostics where you won't just test once, you will look at the stage of the condition and monitor its progression. If you can contain disease at a particular stage it has a great effect on outlook for the patient," said Pearce.

"We are beginning to see the evolution of this next generation of products, which will be high-margin, high-value applications for proteomics."

Apart from stroke, Proteome has discovered biomarkers for Alzheimer's disease, cancer and cardiovascular disease that can be used both in diagnosis and in assessing the stage of disease. Pearce also expects to do deals in blood transfusion screening.

"We see our immediate economic value in the lower hanging fruit of diagnostics, but we will move into prognostics, and, obviously, our markers have potential as therapeutic targets."

Proteome had £6.2 million (US$11.6 million) in cash at December 2003, enough for 18 months at the current burn rate. The company told shareholders last week that it will be generating sustainable and growing revenues as it moves into 2005.

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