roche

I've posted this article before and it is from 2009 on the partnership first being signed - but with it awaiting the next move.......

I thought i'd put my 3,000th HC post to good use.... :-)


Phylogica cuts "major" Roche deal

Tuesday, 22 December 2009
Nick Evans

PHYLOGICA says it has cut a major discovery deal with global major Roche, which will see the pharmaceutical giant screen Phylogicas Phylomer peptide library for potential drug candidates.

While the terms of the deal have not been disclosed, Phylogica corporate development vice-president Dr Paul Watts told BTN the deal was a significant one for the Western Australian biotech junior, which might see the company earning substantial revenue within the year.

While Watts was unable to disclose any details of the deals structure, he said there were some sign-on payments involved which should be visible in the companys quarterly financial disclosures from early next year.

I can tell you that, depending on how we perform, it could be worth a lot of money to us and were talking a lot of money, he said.

Its not some stupid little pilot program, lets put it that way. Its real its taken since April to negotiate the details, and Roche is deadly serious about it.

The deal will see Roche screen Phylogicas library for large molecule compounds capable of hitting protein targets inside cells, potentially the next major area for biologic drug development. Most biologics, such as antibodies, can currently only target and bind proteins on the outside of cells.

Roche has chosen Phylogica because there arent that many companies that have had any success in getting biologics into cells to intracellular protein targets, Watts said.

He added that intracellular targeting might be the next major frontier for drug development.

Small molecule drugs target about 300 proteins in the cell. There are about 28,000 genes in the human genome that encode a few hundred thousand proteins if you include the different isoforms that each gene can encode, he said.

But most proteins are inside the cell, not outside of the cell. Currently biologics can only hit the minority of proteins you find outside of the cell. And the point of the biologics revolution is that people want to access the protein targets that cant be hit with small molecule drugs those small molecule targets are drying up and the low-hanging fruit are largely gone.

But the problem with the biologics class now is that theyre great for external targets Herceptin binds the HER2 protein and Embrel binds TNF but those are drying up too. The real question is how do we access the intracell space, which is most of the targets.

Weve hit some of those targets, which is why Roche has come to us.

Watts believes the deal will help to validate Phylogicas business model, which is focused on early-stage discovery deals with multiple partners, rather than taking its own drugs through the clinic.

The deal is commercial, were not doing this for nothing, and theres real money in it for us. It proves our discovery model works if youve got a good library, you can leverage the library multiple times in discovery partnerships and earn real revenue, he said.

Morphosys did this successfully in Europe and became profitable with tens of millions in revenue without having a single product in the clinic. So people who imagine that the only way to make money in biotech is to take a single product to Phase 2b and then licence it out are very naive there are plenty of companies in the antibody space who also leverage libraries, and do the contract discovery work for milestone payments and royalties without having to take any of the clinical risk.

And were talking to maybe another 15 or 20 companies who are queuing up behind Roche to talk to us about these kinds of deals.

http://www.biotechnologynews.net/storyview.asp?storyid=1040386