SYDNEY - Listed biotech company Amrad Ltd. will spend A$10 million (US$5.9 million) over a two-year period, looking for new lead molecules to treat a range of conditions, including obesity and rheumatoid arthritis (RA), using the results of a breakthrough at a Melbourne research institute.
Along with disclosing the new project, Amrad declared a loss for the year ending in June of almost A$8 million after tax. The net loss for the previous year was around A$4.2 million.
In announcing the loss, Amrad Managing Director John Grace said the company had increased spending on research and development by 47 percent during the year, to A$27.2 million - a figure that makes Amrad one of the top five biotechnology companies in Australia in terms of such spending.
Over the next two years, part of the growing research budget will be spent on looking for lead molecules able to affect a key part of the complex signaling pathways inside cells - a part that involves the suppressor of cytokine signaling (SOCS) family of proteins discovered at the Walter and Eliza Hall Institute, in Melbourne.
Director 'Confident' About Finding Molecules
Amrad will spend A$10 million, partly in cash, to support further work at the Cooperative Research Centre (CRC) for Cellular Growth Factors (associated with the Hall institute). The company also will use its in-house expertise in mass bio-screening.
Douglas Hilton, director of the CRC for Cellular Growth Factors, said his center will develop the bio-screens and Amrad will use them in its existing, active bio-screening operations to find lead molecules. He said he is “confident“ of finding a number of lead molecules for the treatment of a range of human conditions, including obesity and rheumatoid arthritis.
Hilton led the research that discovered the SOCS cytokines, believed to play a major role in switching off cellular processes. Hilton's team suspected there were signaling molecules that turn cellular processes off, in addition to the many known proteins that turn processes on. (See BioWorld Today, Nov. 5, 1997, p. 1.)
He said his team has since investigated the effects of SOCS proteins, using genetically engineered knockout mice with the genes for certain SOCS proteins turned off to see what diseases developed. The results are promising but they are still commercially confidential, he said.
SOCS proteins have been implicated in obesity and in arthritis, he added.
Amrad reported a major loss for the fiscal year ending in June, but Grace also declared that the company exceeded agreed targets for revenue generation and cash usage, and vowed it will be in the black by 2001.
New Diagnostic Tests Launched
Apart from its biotechnology operations, which generated sales of A$13.2 million during the year, the company has extensive pharmaceutical operations. Sales from those operations increased by 15 percent to A$110.8 million to achieve a profit of A$8.2 million.
In addition, the company has launched a new series of rapid diagnostic tests involving a match-book-size fold-over card that can quickly diagnose two different types of malaria from blood samples.
The kits, made by printing techniques licensed by newly acquired Amrad subsidiary ICT Diagnostics Ltd., bear the reagent on one side of a small book and the sample on the other. The two halves are pressed together by an operator to gain a reading.
Amrad bought ICT for A$50 million in cash and Amrad shares early this year.
Along with pharmaceutical and rapid-diagnostic operations, Amrad has a portfolio of biotechnology projects, including an oral rotavirus vaccine that has just completed Phase IIa clinical trials. A treatment of neurodegeneration and neuromuscular disease associated with chemotherapy recently finished Phase I trials. The results of those studies have yet to be announced.
A recent setback for the company has been the abrupt termination of a bioequivalence study of a reformulation of the injectable anesthetic propofol, after volunteers developed adverse reactions, including irritation around the injection site. *
From Phase II For Hay Fever, Typhoid