competitive advantage

The big pharmas will be keen to get a wriggle on...

Competitive position

One of the key reasons for this is the growing interest in peptide drugs, which has increased in recent years. There are currently 54 marketed peptides which represent a US$4 billion market (excluding insulin). There are at least 334 peptides that have been in the clinic and of these 129 peptides are currently in development. It is worth noting that virtually all new peptides come from analogues of natural peptides or are designed from parts of interfaces (eg. Trimeris/Roche,Kai/BMS, Aileron/Roche). PYC’s phylomer libraries contain several billion distinct peptides, providing a bigger pool of different structures from which to choose compounds.

The interest in the discovery of new drugs and drug like candidates (including peptides) is being driven in part by upcoming patent expiries of blockbuster drugs with an estimated US$250 billion in sales are at risk between now and 2015, according to data from EvaluatePharma. In 2010, the pharmaceutical industry had sales of US$860 billion worldwide, up 3% from 2009. According to IBISWorld, just 133 blockbuster drugs accounted for US$295 billion of those sales. Of those blockbusters, 13 are set to lose patent protection through 2013.

Going forward, with large pharma looking to re-fill pipelines, we believe peptides will continue to be of interest to drug developers due to their advantages over larger biologics (eg. MAbs). See Chart 3.

The advantages of peptides include:

? patient friendly delivery – eg: intranasal spray formulations;
? can be made synthetically at low cost;
? can be delivered into cells; and
? can exhibit good tissue penetration due to smaller size.

Source: http://www.phylogica.com/media/articles/Investors---Analyst-Coverage/20110901-Full-year-result-shows-improvement-635/PYC110831-Full-year-result-shows-improvement.pdf