LONDON ¿ PPL Therapeutics plc, of Edinburgh, Scotland, is scouting for development grants to finance the expected #45 million (US$73.2 million) cost of building a production facility for its lead compound, alpha-1-antitrypsin (AAT).

Funding is available to build in the U.S. and PPL says, ¿In principle, the plant could be sited almost anywhere, but in practice it will be sited where the best funding package is available.¿ The company, which specializes in producing human proteins in transgenic animals, is now assessing what sort of package is available in Scotland and in New Zealand, where it has farms.

The company has not yet secured a partner for the product, though Ron James, managing director, said there was a positive reaction from two potential partners to the Phase IIc data in cystic fibrosis, released in February 1999. PPL also hopes to get the product approved in the treatment of congenital AAT deficiency, which is currently treated with plasma-derived AAT.

AAT inhibits the action of elastase, an enzyme that helps break down connective tissue, and which is produced to excess in the lungs of cystic fibrosis sufferers.

PPL is currently milking 600 transgenic sheep in Scotland, but says that to produce enough milk for full-scale commercial production of AAT it needs to expand to 4,000 sheep. It has decided to locate this flock in New Zealand, and in March it received approval from the country¿s newly formed Environmental Risk Management Authority to import transgenic semen from Scotland to expand the flock.

Company¿s Loss, Progress Both Grow

PPL gave this progress report as it released results for the year ended Dec. 31, 1998, showing pre-tax losses growing to #14.2 million from #10.2 million for 1997. Spending on research and development rose to #13.5 million from #11 million, while revenues fell to #478,000 from #1.2 million in 1997. A 6-for-5 rights issue at 80 pence per share in October 1998 raised #2.61 million, and the company ended the year with #25.8 million cash, up from #20.4 million at the end of 1997.

There was also progress in the company¿s peptide production system, with ¿commercially useful¿ levels of calcitonin being produced in the milk of transgenic mice. Nuclear transfer has been used to produce founder sheep using the same gene construct, and several pregnancies have been established in surrogate mothers, with the lambs due at any time. n