HIV study returns good results for Biota technology

Impressive US test results which indicate the effectiveness of a potential anti-HIV/AIDS drug is generating good news on three levels for anti-viral specialist Biota Holdings.

The results are the first clear evidence of the value of Biota's N-MAX drug discovery platform technology. They also open the door for partnerships to further develop the new compounds and they justify Biota's $15 million investment in its US subsidiary Biota Inc, which has developed the compound.

The tests were done by an independent US lab on a series of novel compounds created by Biota Inc, an 88 per cent owned subsidiary whose president, Dr Dan Cook, also leads the scientific team working on the early lead compound.

Ex vivo tests conducted on drug-resistant HIV strains in human cell cultures by the Maryland lab showed that the compound, dubbed B-108 by Biota, was many times more effective and also less toxic than leading anti-HIV drug AZT (zidovudine).

The compound is a nucleotide mimic -- a novel version of nucleoside drugs such as AZT which are widely used to treat HIV, hepatitis C and cancer.

The tight time frame of less than a year in which Cook's team provided proof-of-concept for the N-MAX technology and discovered the AZT-mimic B108 was "a remarkable success," Biota Group CEO Peter Molloy said in a statement.

The most encouraging test results involved PBMC cells which are essentially white blood cells typical of the type infected by HIV, Molloy said: "what was particularly encouraging was that the cells were multiple drug resistant strains of HIV and not just the normal HIV strain."

Against that target, the Biota compound showed itself "many times more efficacious than AZT and appeared to have less toxicity".

The seemingly successful application of the N-MAX platform in the AZT field means it can be deployed against other nucleoside targets because "we have discovered what might be called in over-simplified terms a generic docking module," Molloy said.

He declined to specify which other HIV drugs would now receive attention from Biota.

For Biota's board and upper management, the positive US results lend much-needed credibility to its corporate turnaround strategy.

In March, the board had to fight off the attentions of a major shareholder, West Australian entrepreneur Farooq Khan, depicted by the company as a corporate raider.

Pointing to Biota's slumping share values, Khan had criticised the board's performance and called for a strategy re-think but that pressure should be eased by the new results.

"The company made a gutsy decision a year ago when it decided to invest $15 million in Dan Cook and his technology," said Molloy. "Today that is paying off because his team has delivered better than expected results more quickly than expected."

On another front, Biota is pursuing a possible role in the potentially profitable fight against the SARS respiratory virus.

The anti-flu drug, Relenza, that Biota helped develop is not likely to work against SARS but other compounds in its library of drugs might well prove useful, Molloy said.

Testing its compounds against SARS isolates in Australia are hampered by the lack of stringent containment facilities in this country, he said.

However the company is using its network of contacts in the US, which does have such facilities, to try and interest SARS researchers there in testing its compounds.