LONDON - PPL Therapeutics plc, which specializes in the production of human proteins in the milk of transgenic animals, has agreed to a deal with Novo Nordisk A/S, of Bagsvaerd, Denmark, and ZymoGenetics Inc., of Seattle, to test the feasibility of producing transgenic glucagen-like peptide (GLP-1).

PPL holds the exclusive worldwide license to the technology that produced Dolly, the cloned sheep.

In this collaboration, the company, based in Edinburgh, Scotland, will attempt to demonstrate that its method is an economical way of manufacturing pharmaceutical peptides. Last year, PPL announced it had successfully expressed amidated salmon calcitonin, the first such peptide to be synthesized in the mammary gland and extracted from the milk of a transgenic animal.

GLP-1 is a naturally occurring human peptide that stimulates production of insulin and normalizes blood sugar levels in the treatment of Type II diabetes.

PPL also released interim results for the six months ending June 30. These showed a pre-tax loss of £6.7 million (US$11.2 million), up from £5 million in the same period in 1997. With its cash burn currently running at £1.3 million per month and cash on hand of £12.6 million, the company will need to raise more money around the end of this year. First-half revenues fell to £200,000 from £500,000 a year earlier.

Financial terms of the deal with Novo Nordisk were not given, but Ron James, managing director of PPL, said if the feasibility study is successful, commercial supplies of transgenic GLP-1 will be available in five years. PPL would then expect to negotiate a manufacturing contract for the product, he said.

PPL also said its lead product, Alpa-1-antitrypsin (AAT), has entered Phase IIc trials in the treatment of lung infections in cystic fibrosis patients. This trial, which will monitor clinical outcomes as well as biochemical markers, will be completed at the end of next month. The results are due by the end of the year, and favorable results would put the company in a good position when it attempts to raise money.

At the end of June, PPL received FDA approval to start Phase II studies of AAT in the U.S., where the compound has been granted orphan drug status by the FDA. *

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