HIV & HCV first-in-class drug Undiscovered Stock
Biotron Limited (Bit.ax)
Marketcap: 14 million US$
HIV trial start Phase 1b/2a in 2Q 2008 results in 3Q 2008
HCV trial start Phase 1b/2a in 2Q 2008 results in 3Q 2008
www.biotron.com.au
BIOTRON LIMITED
DIRECTORS' REPORT
The data from this Phase I clinical trial indicated BIT225 was well tolerated, with no dose limiting toxicities. Preliminary
analysis indicated that potentially therapeutic blood levels of BIT225 were achieved, based on calculations extrapolated
from preclinical in vitro antiviral efficacy studies. The data from this Phase I trial is the first human clinical analysis of
BIT225, and are important as they set the stage for further studies of the drug in patient populations. The data
demonstrate that the absorption, distribution, half-life, and tolerability of BIT225 are acceptable, and that safety and
pharmacokinetic (PK) profiles of BIT225 support ongoing clinical development.
BIT225 represents a novel, first in class approach to the treatment of HIV. BIT225 specifically targets HIV in reservoir
cells and represents an opportunity to attack HIV at its source in the body. Current HIV therapies have little or no effect
on HIV in the underlying reservoir of infected cells where the virus hides from the immune system.
In addition, BIT225 represents a first-in-class drug for treatment of HCV, targeting the p7 protein of HCV. It is estimated
that in the USA alone, some 4 million people have been infected with Hepatitis C with 2.7 million suffering from chronic
infection. Worldwide, 170 million people are infected. HCV causes inflammation of the liver, which may lead to fibrosis
and cirrhosis, liver cancer and, ultimately, liver failure. Existing drugs for HCV have limited effectiveness and toxicity
issues, leaving a significant need for new therapies. The worldwide market is currently almost US$3.0 billion, but it is
estimated that this market will expand to over US$10.0 billion as safe, effective therapies enter the market.
During this half year period, independent research in the USA demonstrated that Biotron's lead antiviral drug, BIT225,
significantly enhances the activity of existing HCV therapies in an in vitro model system. The results of this research,
performed by Southern Research Institute, Maryland, USA, are significant as they indicate that BIT225 has the potential
to be used in combination therapy to achieve a higher level of antiviral activity against HCV than is currently possible,
while improving the potency of each of the drugs in the combination.
The results demonstrated that BIT225 was highly synergistic in a triple combination with two of the most commonly used
HCV therapies - ribavirin and interferon-α. The addition of BIT225 to ribavirin and interferon-α increased the level of
inhibition of viral replication from 70% with the two other drugs to 100% when BIT225 was added to the mix. The
potency of BIT225 was increased tenfold in this triple combination, compared to its activity on its own.
The studies were conducted in vitro against the widely accepted surrogate model of the HCV, bovine viral diarrhea virus
(BVDV). BVDV is closely related to HCV and is an in vitro predictor of the efficacy of anti-HCV drugs in humans.
Previously, Biotron reported that BIT225 is a potent inhibitor of activity in this HCV surrogate model system.
Biotron has filed a new patent to extend the current protection over its lead antiviral drug BIT225 and analogues. This
latest patent filing further strengthens Biotron's extensive intellectual property portfolio in the antiviral drug development
field.
Biotron is now focused on progressing BIT225 into Phase Ib/IIa clinical trials in both HIV and HCV infected subjects. The
completed Phase I clinical trial in healthy volunteers will support the trials in these two patient populations, which
significantly reduces the costs and timelines of Biotron's clinical development program. Trial designs and regulatory and
ethics submissions are in final review for two trials, one in HIV and one in HCV populations and, subject to regulatory and
ethics approvals, with likely commencement of these trials in the second quarter of 2008 and concluding during third
quarter of 2008.
These proposed trials in HIV and HCV patients are critical steps in the Company's development. Demonstration that
BIT225 can attack these viruses in patients will be a truly major advance in terms of Company and technology valuations.
The Company is focused on achieving a successful outcome, and has been progressing discussions with potential
pharmaceutical companies in anticipation of finalising a deal once these trials have been completed. The proposed trials
are designed to benefit shareholders through significantly increasing the value of Biotron in the market and to its future
pharmaceutical company partners.
Biotron continues to leverage shareholder funds by accessing non-equity funding to support its development programs.
During the half year period under review, the Company received a grant of $441,944 from the Commonwealth
Government's Commercial Ready Grant Program. The grant is a partial reimbursement of expenditures incurred in the
Phase I clinical development and testing of BIT225.
This latest grant is in addition to the previous grants, including a Biotechnology Innovation Fund (BIF) grant which
assisted with early-stage development of new drugs for various targeted viruses, and a Start Grant which facilitated the
selection and preclinical testing of BIT225.
In December 2007 Biotron initiated a $2.5 million underwritten Share Purchase Plan (SPP) to raise additional capital for
clinical development of its antiviral programs. The funds raised by the SPP will be used to support the Company's
ongoing operational costs, including funding the clinical development of the Company's drug BIT225 into Phase Ib/IIa
clinical trials in infected patients.
Other Viral Programs
In addition to excellent progress with the Company’s anti-HIV and HCV development programs, Biotron further advanced
its antiviral platform with the finding that several of its proprietary compounds have shown potent activity against the
Hepatitis B virus (HBV).
According to the World Health Organisation (WHO), 350 to 400 million people are chronically infected with HBV. Chronic
Hepatitis B (CHB) is a serious global health problem, with infection progressing to liver cirrhosis and hepatocellular
carcinoma, resulting in up to 1.2 million deaths worldwide each year. Up to 80% of the world's primary liver cancer,
which is currently the fifth most frequent cancer worldwide, is attributable to chronic CHB.
This latest activity data against HBV demonstrates the depth of Biotron's antiviral portfolio. The Company has an
impressive portfolio of clinical and preclinical antiviral programs developing drugs targeting HIV, HCV, Dengue virus and
Influenza virus. At present, focus is on development of the HIV and HCV programs into trials in infected patient
populations, and additional resources will be committed to these additional programs once these more advanced
programs have been successfully commercialised.
Discussions continue to be held with potential partners regarding the Virion technology. Whilst keen to secure a partner
to take the Company’s compounds through into clinical development, Biotron can significantly increase the value of the
technology by undertaking the proposed Phase Ib/IIa clinical trials before forming an alliance. This will translate into
much higher returns to the Company in the form of upfront payments as well as increased milestone and royalty
payments in the future.
The level of interest by the international community in Biotron’s antiviral programs is reflected by the selection of Biotron
to participate in several prestigious international scientific conferences. In July 2007, Biotron was selected to give two
presentations at the International AIDS Society conference in Sydney, NSW, and in December Biotron scientists were
selected to present data at an HCV conference and at an HIV conference in the USA. Presentation at these meetings
provided an excellent opportunity to further discussions of the Company’s technologies with potential pharmaceutical
