Epistem chief: DIY bio kits could be spun off
Bryan Bishop
Epistem chief: DIY bio kits could be spun off
http://www.crainsmanchesterbusiness.co.uk/article/20100315/SUB/303159982
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By Claire Shoesmith
Manchester-based biotech company Epistem is considering selling
do-it-yourself kits that will enable pharma companies to carry out
their own biomarker tests using its technology.
Currently Epistem retains the intellectual rights to the biomarkers it
discovers and charges all users a licence fee. This change would
enable users to pay a one-off fee for the technology and then carry
out the work themselves.
Biomarkers enable the effectiveness of a drug to be tested by plucking
out a hair follicle rather than taking a blood sample. Analysts and
industry experts expect the process to play a bigger role in
diagnostics in the future because of the trend towards personalised
medicine and targeted therapies.
“We would be letting others take our platform and chew on it
themselves,” Matthew Walls, Epistem's chief executive, told Crain's,
adding that there would be multiplication in value terms.
Revenue from the group's biomarker division was little changed at
£300,000 in the six months to the end of December, according to
results released last week.
Walls said the company hoped to grow the business by extending the
process into areas other than hair, such as tissue, as well as seeking
a bolt-on acquisition, which would expand the biomarker team from the
current five staff.
“There is great potential for this area of business,” said Walls.
Dr John Savin, an analyst at Edison Investment Research, agreed with
the potential, but said it was unclear how much money Epistem would
make from selling biomarker kits.
“Companies are always trying to avoid doing their own cooking so
demand would be there,” he said, adding that while some firms such as
AstraZeneca, Johnson & Johnson and Merck are happy for Epistem to
retain intellectual property rights over the markers, there are others
who will be more inclined to buy a kit and carry out the work
themselves.
Walls said the next few months would be crucial for Epistem's novel
therapeutics business as the company decides whether to continue with
the deal it signed with Novartis. He said that so far the partnership
was working well, with several leads emerging, but indicated that if
the division were to grow significantly over the next few years it
would be a prime target to be split off from the rest of the business.
Hottest area
“Drug discovery is going to be the biggest part of the business going
forward — it's the hottest area,” Walls told Crain's. “It is possible
it could be separated off in the future.”
Savin was not so sure, saying that despite their differences,
Epistem's three divisions were more interlinked than it appeared.
“There is a commonality of tests across the divisions,” he said.
Epistem has said that progress is being made on the drug development
side, but Savin pointed out that it had yet to release any details and
it was still at least two to three years away from even the
pre-clinical trial stage. “Only at that point will we really know what
is going on,” he added.
Shares in Epistem have risen 55 per cent over the past 12 months and
are currently trading at around 430p. The company's two largest
individual shareholders are co-founders Dr Catherine Booth and Dr
Chris Potten, with stakes of 11.9 per cent and 6.5 per cent
respectively.
COMMENTS? cshoe...@crain.com
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