By Mary Welch

Pilot Biotechnologies Inc. wants to "help mankind in a commercial context" by developing treatments for rheumatoid arthritis, asthma and possibly cancer, said Phillips Johnston, CEO.

Formed late last month in a collaborative effort from Wake Forest University and North Carolina Sate University's College of Agriculture and Life Sciences, both of Winston-Salem, N.C., Pilot is founded on the work of F.H. Chilton, a director of molecular medicine and professor of internal medicine, physiology and pharmacology at Wake Forest.

Chilton examined for more than two decades the physiological characteristics of arachidonic acid, focusing on divining the fatty acid's role in reducing cellular inflammation.

When cells produce arachidonic acid, mechanisms are triggered that protect the body from infection. However, a toxic response is generated when these same fatty acids are produced in excessive amounts, leading to inflammatory diseases such as asthma and arthritis. It also affects proliferative disorders, such as cancer.

Although the cause-and-effect relationship between arachidonic acid and human disease is well known, it is not understood what prompts the acid to change from a giving out a protective response to a toxic one. Chilton's work has helped to find new ways to control levels of arachidonic acids, ways that include nutritional formulations as well as pharmaceutical products that block key enzymes.

His research and patents involve inhibiting the action of a particular enzyme that will block certain cellular responses. Johnston said the company has "10 patents [two on methods and eight on new compounds] that involve the CO-AIT [Coenzyme A-independent transacylase] pathway that will inhibit cancer, particularly breast cancer, from having the opportunity to travel. A lot of companies are working on this. It's like a race to the South Pole, but we've been working on this for two decades."

Pilot, based in Winston-Salem, was spawned at Connectivity '98, a conference bringing together capital sources and faculty ideas from area universities. Glenn Kline, a managing director of Centennial Venture Partners, of Raleigh, N.C., met Chilton and discussed the biological processes — as well as commercial potential — of arachidonic acid. Kline now serves as chairman of Pilot. Chilton is the chief scientific officer.

Centennial, created by North Carolina State University from private capital, is designed to invest in start-up firms with novel technologies that have university ties or significant university connections. Centennial provided the start-up funds and located Johnston to run the company. Resources from both universities will be tapped.

Johnston came to Pilot from Digital Recorders Inc., a Research Triangle Park, N.C-based company. He has guided eight early-stage venture companies through start-up.

Pilot, which has eight "virtual" employees and four full-time workers, hopes to raise about $5 million within the next six months in a private placement.

"We intend to get to the public market in a hurry, possibly when our products are in Phase I, if not sooner," Johnston said. "It takes an enormous amount of money for a start-up company, [but] we're more of a technology-transfer company rather than a start-up. [Chilton] has been working on this for two decades. We're not just scratching our heads trying to figure out how to be commercial. We know how."

Nutriceuticals Offer Shorter Route To Market

Pilot also is looking at nutriceutical formulations, particularly an oral dietary treatment targeted toward inflammation related to arthritis and asthma. These nutriceuticals or "God's drugs," as Johnston calls them, bypass FDA approvals, which means they are commercialized quicker. "There's a lot to be said for these new nutriceutical products, especially when you're putting a lot of science behind them, which we are," he said.

Some of Pilot's work involves research into producing the rare fatty acids that are the backbone of its products. Tobacco could play a key role in producing these fatty acids, and genetically engineered crops will be necessary to create the substances that form the base of the nutriceutical products.

"I think the use of tobacco is being overplayed," Johnston said. "There's an element of truth in it, and it would be a valuable therapeutic use of a crop that is so important to so many people in North Carolina." *