Peptech earns TNF patent protection in US

Sydney-based biotech Peptech (ASX: PTD) has gained United States patent protection for its tumour necrotising factor (TNF) antibodies, priming the company for its next growth phase.

The US patent follows others previously granted in Europe and Australia.

But managing director Stephen Kwik said that because the patent process in the US was different to that in Europe, divisional patents have also been lodged with the US office to gain comparable coverage.

Kwik said Peptech received notices of allowance, a formality indicating an intention to grant a patent, in relation to the divisional patents in March.

"Our claim language in this and the three other divisional patents has maximised our intellectual property's relevance to most of the antibody products today," Kwik said.

"We are continuing to evaluate the enhancement of our patent coverage in the anti-TNF area."

Peptech says its TNF patent portfolio is attracting worldwide interest because it was increasingly being recognised as the point of entry to the TNF therapeutics market.

The company's TNF research began in 1988, with patents granted in Australia and Europe said to predate those of current drugs.

TNF is a protein involved in the immune response, which, because of its pro-inflammatory characteristics, is believed to have a role in the pathology of inflammatory disease such as rheumatoid arthritis and Crohn's Disease.

Recent approved products that bind and inhibit TNF activity include Enbrel (etanercept) developed by Immunex and Remicade (infliximab) developed by Centocor.

Other anti-TNF products in late stage trials are D2E7, a product of Abbott Laboratories, and CDP 571, under development by Celltech Chiroscience.

Peptech estimates the total market for these products is in the order of $US1-2 billion a year.

Kwik said today's announcement left the company positive and optimistic and future cash flows.

"With this patent and the upcoming issuance of three further divisional applications, I believe that additional royalties will now be received in the near future from Centocor, and with D2E7 expected to commence sales in 2003, the company is now in a position to plan for its next growth phase," Kwik said.

"An important part of these plans will remain the shareholding in Domantis and the research collaboration with them which is designed, among other things, to produce products which will increase yet further the value of our patents in the anti TNF antibody area".

The US patent announcement followed a trading halt for Peptech on Tuesday, but not before the stock managed to climb more than 7 per cent to $2.64.

The shares continued their rise after the announcement was made, with the stock changing hands almost 1.5 per cent higher at $2.68 at the time of writing today.

The latest news comes on the back of a flurry of announcements from the company this month.

On July 5, Peptech told the market its collaboration with Domantis, which is focused on the development of Domain antibodies, was progressing well and tracking ahead of schedule.

And on July 3, the company relayed an announcement from Johnson & Johnson explaining that the US Food and Drug Administration had granted marketing approval to Remicade for the treatment of Crohn's disease.