Transcription of Finance News Network Interview with Phylogica Limited (ASX:PYC) Chief Financial Officer, Nick Woolf.
Melissa Beaumont Lee: I’m Melissa Beaumont Lee for the Finance News Network. Joining me from peptide discovery company Phylogica Limited (ASX:PYC) is Chief Financial Officer, Nick Woolf. Nick welcome back.
Nick Woolf: Thank you.
Melissa Beaumont Lee: When we last spoke with you in January, you’d just announced your fourth partnership with Johnson & Johnson’s pharmaceutical unit, Janssen. Can you tell us more about that?
Nick Woolf: Yes of course. So we signed the deal with Janssen, which is the pharmaceutical arm of Johnson & Johnsonat the end of last year, and we announced it on January 3, 2012. The project is now underway, we have received an upfront payment from Janssen of $US1.2 million and the project that we’ve initiated, is an 18 month plan to discover a cell penetrating peptide.
Melissa Beaumont Lee: And what makes this deal particularly appealing for Phylogica?
Nick Woolf: Well it’s another demonstration for us that we can get our peptides not just on the surface of cells, but we can actually use our peptides to pull therapeutic cargoes through the cell membrane and address what is currently, one of the undrugable spaces for biologics, within the cell. And under the terms of this deal, Janssen can develop a number of programs using this one universal peptide that we’ve discovered for them.
In addition to that, they also have an expansion option where the deal could be expanded several times larger than it is today, to develop a number of candidates using different cell penetrating peptides.
Melissa Beaumont Lee: Thanks Nick, can you briefly update us on your other deals. What progress is being made and what are you looking for?
Nick Woolf: Well we have three other relationships - with Roche, Medimmune ,which is the biologics unit of AstraZeneca, and with Pfzier. All of our relationships are progressing well. Our deal with Roche is around identifying peptides that can cross the blood-brain barrier and can carry therapeutic cargoes into the brain. And with them we are currently having delivered on the objects last year, we’re now in discussions with a group within Roche in the US, about the next steps.
Our relationship with Medimmune is around identifying novel antibiotics against a hospital acquired superbug called Pseudomonas, one of those drug-resistant bugs. And we have made good progress there; we announced in November that we’re entering the final stages. And we’re very close now to completing that, in terms of the research work for the initial identification of peptides.
With the Pfzier collaboration, the relationship is around vaccines, identifying peptides from our libraries that can mount an immune response against a target of interest to Pfzier. And we announced at the end of last year in December, that we had successfully met the objectives of that program and Pfzier is now evaluating those peptides in their own facilities.
Melissa Beaumont Lee: Can you tell us about your recent US patent for neuroprotective peptide inhibitors?
Nick Woolf: Well this is one of the exciting in-house drug candidates that we’ve been developing. And we’ve taken it through a number of preclinical studies and shown proof of concept in terms of efficacy. And the drug itself has potential in diseases such as stroke or traumatic brain injury, for someone who’s had a gunshot wound or a car accident for example. And it’s one of the prospective candidates that we are now in discussion with a number of pharmaceutical companies, around potential licensing.
Melissa Beaumont Lee: On the subject of discovery alliances, how many are you targeting for this calendar year?
Nick Woolf: Well our guidance is to do three deals per year and we’re very much on track to do that. In addition, we are looking to do second deals with some of our existing partners and we’ve got a number of discussions in place. And it’s under some of the new deals that we’re looking to do this year, you’ll see an evolution of our business model. Where in addition to the backend, downstream milestones and royalties that we’ve secured in our deals to date, we’re also looking to retain an option at Phylogica’s election, to maybe co-invest into the development. So that we can retain more value downstream, from anything that comes from our libraries.
Melissa Beaumont Lee: Turning now to your first half results, what was the result for the first six months and was this in line with your expectations?
Nick Woolf: We reported revenue of $1.4 million for the first six months of the year, and we reported a cash position at the December 31, 2011 of $4 million. And it was very much in line with our expectations for the year.
Melissa Beaumont Lee: In the past, you’ve mentioned the goal of becoming self-funding, how far away is that?
Nick Woolf: Well the second half of this financial year, the year to June 30, 2012 we anticipate being cash generative. And continuing through the calendar year and carrying on, our revenue guidance for the full financial year is $4 million to $6 million. And we envisage doubling that revenue line in the financial year to June 2013.
Melissa Beaumont Lee: And to finish up Nick, I see that Phylogica’s recently appointed Jeremy Curnock Cook to the position of Non-Executive Director. Could you tell us about the expertise he brings to the Company?
Nick Woolf: Well Jeremy is a biotech executive guru. He’s sat on a lot of Boards; he’s got experience both as an entrepreneur and also as a fund manager of life science funds. He used to be the head of the Rothschild Bioscience Unit, a global biotech fund based out of London. He currently heads up the International Bioscience Managers Bioscience Funds here in Australia.
And he brings to the Board, both that expertise and experience in both deal-doing and the evolution of our business model as a platform company, now that we’re evolving towards cash sustainability and where we go from there, but also relationships with his industry contacts.
Melissa Beaumont Lee: Nick Woolf thanks for the update.
Nick Woolf: Thank you so much.
Ends
PYC Price at posting:
4.3¢ Sentiment: None Disclosure: Held
(20min delay)