Viragen (VRA) Confirms Potential Of Avian Transgenics
PRNewswire 3oct01

PLANTATION, FL -- Viragen, Inc. and Roslin Institute (Scotland) today jointly announced the successful production of the world's first humanized antibody using chicken cells. The humanized antibody, GD3, is designed for the treatment of melanoma and certain other cancers. The successful experiment is considered a very important milestone in Viragen's Avian (bird) Transgenic Project. The project is designed to produce protein-based drugs, including monoclonal antibodies, to fight cancer, inside the eggs of transgenic chickens. This "Proof of Principle" study is significant in proving that therapeutic antibodies produced in the whites of eggs laid by hens promise a much faster, cost-effective and virtually unlimited production process.

Roslin Institute's Dr. Helen Sang, the Avian Project's Lead Scientist, is one of the world's foremost authorities on avian research and creator of the world's first transgenic rooster by a non-viral method. According to Dr. Sang, "It has been proposed that chickens should be able to synthesize functional human antibodies, but no one to our knowledge had ever before accomplished this. This is no longer theory and "Proof of Concept" has been established. Our ultimate goal is to accelerate the production of many existing or new drugs, either in clinical trials or being commercialized, and to do it cost- effectively and in large-scale."

Viragen's COO, Dr. Magnus Nicolson, stated, "The first antibody which we aim to produce via transgenic hens is the GD3 antibody. Developed in collaboration with scientists at Memorial Sloan-Kettering Cancer Center, this is a humanized version of the very successful R24 antibody which has shown great promise in the treatment of melanoma. Together with Roslin Institute, we set out to express the GD3 antibody in a chicken cell line. Our 'Proof of Principle' studies are the first, that I'm aware of, to ever demonstrate that functional human antibodies can be produced using chicken cell lines. Our work to date now gives Viragen the advantage of providing potential customers with a feasibility study that will give a clear indication of how the client's protein will behave when it is produced via our transgenic production platform."

Viragen holds the worldwide exclusive license to commercialize Avian Transgenic Technology granted by Roslin Institute in Scotland, internationally renowned for their creation of "Dolly the Sheep". This technology is designed not only to produce Viragen's portfolio of anti-cancer drugs, but also to address the urgent drug production needs of the entire biopharmaceutical industry.

Viragen's CEO, Mr. Gerald Smith, detailed the opportunities presented by this breakthrough. "Drug companies that wish to utilize Avian Transgenic Technology as an alternative production platform now have a reliable scientific test to confirm if avian expression is a suitable production method for their specific antibody."

"Viragen intends to become a Contract Manufacturing Organization ('CMO') for those clients who determine that avian technology is the most useful alternate method for the production of their protein-based drugs. Currently, CMOs are fully booked for years in advance. Analysts generally agree that demand for manufacturing capacity can reach crisis proportions during the next decade. Viragen is positioned to address the lack of manufacturing capacity worldwide by developing this technology. Viragen is also currently designing a cGMP/SPF (Specified Pathogen Free) avian facility on the grounds of Roslin Institute."

Viragen scientist, Dr. Joe Conner, who conducted the ground-breaking experiments, commented, "Humanizing an antibody requires removing most of the non-human regions of the protein by genetic engineering and replacing them with the equivalent human components. Our humanized GD3 antibody expressed by chicken cells was functional in an assay provided by Memorial Sloan-Kettering. I am delighted with the successful outcome of these pivotal experiments and we are currently preparing publication of our results and confirmatory data."

As part of the human immune system, an antibody has been likened to a guided missile that homes in on malignant cells while leaving healthy cells unaffected. Antibodies must be produced in very large quantities to properly dose patients.

Pursuant to a separate collaboration, Viragen and Memorial Sloan-Kettering Cancer Center are jointly developing human monoclonal antibodies for the treatment of melanoma and certain other cancers. Antibodies are being delivered to Memorial Sloan-Kettering's laboratories for in vitro experiments which examine each antibody's ability to bind to a specific tumor cell and employ a variety of immune defenses resulting in the killing of cancerous cells.

It is estimated that there are over 270 monoclonal antibodies in development, pre-clinical or clinical studies. Ten therapeutic antibodies have already been approved by the FDA for commercialization and together are estimated to generate over $2 billion annually. By 2005, the market is forecast to exceed $6 billion; growing to $24 billion within the decade.

To meet growing demand, drug-makers are forced to confront manufacturing issues. Building or expanding a major manufacturing facility can take many years and cost hundreds of millions of dollars. Naturally, companies are reluctant to make such a capital-intensive decision without prior regulatory approval. Some companies that defer these decisions have actually been forced to limit sales once regulatory approval is obtained.

This delays the delivery of drugs to patients. Viragen intends to provide drug makers with the means to produce large quantities of these potentially life-saving protein-based drugs without the need to commit the significant capital necessary to build and operate a large cGMP mammalian cell culture facility.

Dr. Nicolson explained, "We believe that avian transgenic production of antibodies will cost less than other traditional manufacturing methods based on mammalian cell culture. It is also important to note that chicken proteins, unlike those of other transgenic expression animals, have the same sugars as humans. This may offer distinct advantages for patients who develop neutralizing and binding antibodies to foreign sugar epitopes on transgenic proteins which, in turn, may negate some or all of the beneficial effect of the protein drug in the patient."

"Our avian system can be scaled-up quickly due to the prolific egg-laying propensity of hens. Avian technology is designed to eliminate the massive capital outlays required to build a new cGMP cell culture facility. A new plant for a single drug could take two to three years to build and validate."

Viragen also announced that it has filed a patent application covering the production of humanized antibodies in avian cells. Dr. Karen Jervis, Viragen's Director of Product Development, is the main inventor and author of the patent. According to Dr. Jervis, "The patent application relates to an improved method for the expression of humanized antibodies in avian cells. This further diversifies and strengthens our excellent patent portfolio in the field of avian transgenics, providing what we believe are distinct competitive advantages in this arena."

Mr. Smith concluded, "The implications arising from the lack of adequate manufacturing capacity in this industry are far-reaching. There is a very real threat of delaying or abandoning the development of many new, promising drugs. To illustrate, when adding the costs of new plant construction to other drug developmental and clinical costs, the undertaking may not prove feasible. That is because the size of the target market and the estimated revenues to be generated do not support the investment. This could mean that needy patients would be robbed of drugs that could limit suffering and even save life itself. Avian Transgenic Technology promises a lower cost of drug manufacturing thereby permitting promising new drugs to be manufactured in the quantities required to meet growing market demand."

About Viragen, Inc.:

Viragen, Inc. researches, develops and manufactures drugs, including natural human interferon and human monoclonal antibodies, for the treatment of many life-threatening and debilitating diseases such as hepatitis C, multiple sclerosis and cancer. In addition to developing a portfolio of proprietary drugs, Viragen is engaged in the development of Avian Transgenic Technology which is designed to deliver an efficient, cost-effective alternative to the biopharmaceutical industry for the large-scale production of protein-based drugs. Viragen's Oncology Projects include collaborations with the National Institutes of Health (NIH), Memorial Sloan-Kettering Cancer Center and the U.K.'s Cancer Research Campaign.

The foregoing press release contains forward-looking statements that can be identified by such terminology such as "expects", "potential", "suggests", "may", "will", or similar expressions. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different from any future results, performance or achievements expressed or implied by such statements. In particular, management's expectations regarding future research development results could be affected by, among other things, uncertainties relating to clinical trials and product development; availability of future financing; unexpected regulatory delays or government regulation generally; the Company's ability to obtain or maintain patent and other proprietary intellectual property protection; and competition in general. Forward-looking statements speak only as to the date they are made. The Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.