XL-protein Collaborates with Phylogica on Inflammation Program

PERTH, AUSTRALIA, January 13, 2011 – Phylogica Ltd (ASX: PYC), a leading Australian-based drug discovery company, announced today an alliance with XL-protein GmbH, a German-based biotech company that specialises in extending the circulation half-life of biopharmaceuticals. Through this alliance, Phylogica gains access to a unique modification technology that strengthens the Company’s Phylomer drug discovery platform.

XL-protein’s PASylation technology was originally developed by a leading academic group at the prestigious Technical University of Munich (TUM). The technology utilises a genetic technique to fuse a polymer of natural amino acids onto the relevant peptide or protein-based therapeutic, which slows the body’s clearance of the drug and prolongs the therapeutic effect.

Phylogica and XL-protein will initially collaborate on a pilot study to validate the technology in combination with one of Phylogica’s Phylomer peptides targeting CD40 ligand from its in-house anti-inflammatory programme. Under the terms of the agreement, Phylogica has an option to obtain an exclusive license to the PASylation technology for peptide-based products in relation to CD40 ligand and has rights of negotiation for a license to the technology for Phylomers that bind other targets.

It is anticipated that the plasma half-life of PASylated Phylomers will be significantly extended, making them more suitable for less frequent administration and at lower dose. Long acting Phylomers would be ideal for treating chronic indications, such as rheumatoid arthritis, coronary artery disease and inflammatory bowel disease, in which CD40 ligand has been implicated as a potential target.

Phylogica’s Chief Executive Officer, Dr Paul Watt, commented: “Phylogica is excited to enter into this collaboration with XL-protein. This deal provides us with access to the next generation of polypeptide fusions for optimising the half-life of our Phylomers. The technology combination of XL-protein and Phylogica could also significantly facilitate the ease of manufacturing and lower the cost of goods.”

Dr Arne Skerra, founder and CEO of XL-protein GmbH, said: “XL-protein is delighted to apply its PASylation technology to Phylomers, which will serve to validate the benefit of this revolutionary half-life extension technology to a highly promising class of therapeutic peptide drugs.”