Aids drug company clinches a new deal

By Deborah Hill Cone

Friday 5th July 2002

John Chang

Auckland-based biotech company Virionyx Corporation revealed yesterday it would be applying for the US Food & Drug Administration's fast- track programme as it heads into the second phase of clinical trials of its anti-HIV drug HRG214.

Until now Virionyx has been secretive about its work and shunned publicity, refusing to release details about its clinical trials (NBR, May 24), but it went public yesterday, inviting Prime Minister Helen Clark to announce a new investment deal.

Chief business officer John Chang said a new investment syndicate was putting a $2 million "deposit" into the company ahead of doing due diligence, with a view to becoming a cornerstone investor. Dr Chang said the company was taking a cautious approach to the second phase of its FDA trials of HRG214. It would launch what it was calling Phase 2a, which will cost about $1 million and take seven months, before heading into Phase 2 proper.

This would take longer than proceeding directly to Phase 2 but was a more considered and cautious approach.

"We don't want another Lyprinol," Dr Chang said, referring to the controversy surrounding the launch of anti-cancer mussel-extract Lyprinol.

The phase one FDA trial, a single-dose trial carried out on 18 patients at the Beth Israel Deaconess Medical Centre at Harvard, was successful and showed early indications of anti-viral activity, Dr Chang said.

The results of the trial are to be presented by its investigator, Harvard Medical School professor Bruce Dezube at the 14th International Aids Conference in Barcelona next week.

The first phase of testing looks only at safety but the second phase of testing, which is a multi-dose trial with 40 patients, involves assessing efficacy.

Virionyx said it believed it would qualify to apply for the FDA's fast-track programme, set up to allow drugs for life-threatening conditions to be tested and get commercial approval more swiftly.

Dr Chang predicted that if everything went smoothly the drug could be in the market by the second half of 2005.

He said the FDA had given approval for the second phase of trials within only six weeks, which was considered very fast.

"We are quite excited about that," Dr Chang.

Virionyx chief financial officer Paul Young said the company had been searching for a cornerstone investor here and overseas for some time. One of the reasons it had taken so long was because it did not want to dramatically dilute the shareholdings of existing investors. They include controversial entrepreneur Robin Johannink, who was closely involved with the company but who has resigned as a director and is now solely a shareholder.

The investment syndicate which had chosen to back the company had requested that its details remain confidential, Mr Young said.

The $2 million investment was an expression of commitment and would be used to expand Virionyx's Penrose laboratory, Dr Chang said. Virionyx had also received a government grant of $250,000 under the technology for business growth scheme to help it train scientists.

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