Peptech draws strength from antibodies, new and old

Peptech's (ASX:PTD) recent investment in UK domain antibody specialist Domantis took centre stage at the company's annual general meeting today, despite shareholder discontent regarding an employee performance share plan.

Corporate governance issues featured strongly, with a termination payment for departed CEO Stephen Kwik also drawing criticism from shareholders.

Peptech's lead human antibody therapeutic is the first of four antibody targets being co-developed with Domantis. Anti-TNF-alpha has already cleared an early hurdle, showing potency in comparison to other anti-TNF drugs in pre-clinical studies. TNF is implicated in a number of diseases, including arthritis.

"These impressive results endorse the potential of human domain antibodies as the next generation of therapeutics against TNF and reinforces our decision this week to make a second investment in Domantis," said Peptech's executive chairman, Mel Bridges.

Privately-held, UK-based Domantis, in which Peptech now holds a 36 per cent stake, is commercialising a new class of 'domain' antibodies, tiny sections of the antibody which have been shown to be just as specific as normal humanised antibodies in their ability to bind to proteins. "I like to think of domain antibodies as the sensitive fingertips of the antibody," said Peptech director Till Medinger.

Domain antibodies are expected to have significant advantages over current antibody therapies because they are small enough to be taken by injection or orally and can reach more targets within the body. Peptech's anti-TNF-alpha also lasts longer in the bloodstream, meaning that smaller doses may be possible.

Although Peptech has successfully resolved its dispute with Abbott Laboratories over royalties to Humira, it remains locked in arbitration with Johnson & Johnson subsidiary Centocor, claiming that the arthritis drug Remicade infringes a Peptech patent. Bridges said he was confident of resolving the dispute this year.

Peptech intends to launch its companion animal contraceptive Suprelorin in Australia and New Zealand in the first half of this year.

Bridges also flagged the possibility of a dividend, but cautioned that: 'my personal view is that it would be prudent to defer the decision until Peptech has resolved the Centocor dispute."