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7-Business: Fall of pioneer in using transgenic plants for pharmaceuticals has analysts worried field may dry up



                                 PART I
------------------------------- GENET-news -------------------------------

TITLE:  LSBC closing signals pharming trouble
        Fall of pioneer in using transgenic plants for pharmaceuticals
        has analysts worried field may dry up
SOURCE: The Scientist, USA, by Ted Agres
DATE:   17 Jan 2006

------------------ archive:  http://www.genet-info.org/ ------------------


..........................................................................
to download an updated economic analysis of the pharma crop sector
published by Friends of the Earth US and US PIRG (first release in 2003)
please go to:
http://www.foe.org/camps/comm/safefood/biopharm/RiskyBusiness.pdf
..........................................................................


LSBC closing signals pharming trouble
Fall of pioneer in using transgenic plants for pharmaceuticals has
analysts worried field may dry up

Large Scale Biology Corp., a pioneer in transgenic plant-based
therapeutic proteins and vaccines, has become the latest casualty in the
field of "pharming," or producing therapeutic proteins, antibodies, and
vaccines from transgenic plants. After running out of funds in late
December, the company dismissed all 78 staff members in Vacaville, Ca.
and 23 employees from its commercial-scale biomanufacturing facility in
Owensboro, Ky. - and left analysts speculating about the future of the
shrinking field.

"Pharmaceutical and biotech companies have enough risk taking a new drug
through the approval process. To add to that an as-yet unproven plant-
based technology is not something they are willing to do," said Roger
Wyse, managing director of Burrill and Co., a San Francisco-based life
sciences venture capital firm. "That's adding risk on top of risk," he
told The Scientist.

In the 1990s, the concept of pharming held great appeal to drug and
biotech companies, scientists, and investors alike, anticipating that
plant-made proteins would be less expensive and potentially safer than
those produced by traditional mammalian and bacterial cell culture
methods. Large Scale alone spent millions of dollars developing
therapeutic proteins, biologicals, and personalized cancer vaccines from
transgenic tobacco and other crops.

But environmental opposition, regulatory uncertainties, and improvements
in fermentation techniques have since dampened the industry's
enthusiasm. A decade ago more than 180 companies and organizations,
including many of the big pharmas, were involved in pharming research.
Since then, Pfizer, Eli Lilly, Novartis, and others have spun off or
disposed of their agricultural-biotech drug divisions. Today, fewer than
75 companies worldwide -- and only a handful in the US -- are engaged in
any form of plant-based therapeutics, said Lisa Dry, communications
director for the Biotechnology Industry Organization (BIO) trade
association in Washington DC.

Robert Erwin, a company founder and chairman, said the major problem
Large Scale faced was reluctance from drug companies to having their
products developed in crops to cut costs, without knowing how the Food
and Drug Administration would view any resulting new drug applications.
"We really miscalculated on the motivations that a pharmaceutical
company would have to reduce the cost of manufacturing biotech
products," Erwin told The Scientist. "Right now there's not much
incentive for large pharmaceutical companies to worry about either
prices or cost because they can price products however they choose."

Additionally, advances in fermentation technologies have all but
eliminated projected cost savings between using plants and cell culture
approaches, said Charles Arntzen, director of the Center for Infectious
Diseases and Vaccinology at Arizona State University's Biodesign
Institute in Tempe, and a veteran researcher in the field. But even if
the cost differentials had remained, the pharmaceutical companies
wouldn't have cared. "For high-value pharmaceuticals, like a new cancer
drug, the cost of goods is trivial compared to what they can sell it
for," Arntzen told The Scientist.

Nevertheless, several companies are continuing to develop plant-based
drugs and vaccines. While none has been brought to market in the US,
several are in Phase I and II clinical trials. These include recombinant
alpha interferon and monoclonal antibodies developed from duckweed by
Biolex Therapeutics in Pittsboro, NC, and secretory IgA (SigA)
monoclonal antibodies to prevent tooth decay developed from tobacco by
Planet Biotechnology in Hayward, CA. Unlike other monoclonal antibodies,
SigA can be produced only in transgenic plants, the company claims.
"There will be niche opportunities where plants have a special
capability for creating unique materials," Arntzen said.

University of Central Florida researchers recently developed a vaccine
against anthrax (Bacillus anthracis) using a recombinant tobacco
chloroplast genome. In mice, the vaccine proved as potent against
anthrax as fermentation-produced vaccine and was also free from the
latter's bacterial toxin that can cause harmful side effects.

Arntzen and his colleagues also recently developed a vaccine against
plague (Yersinia pestis) using recombinant tobacco, producing high
levels of plague antigens that protected guinea pigs against aerosolized
plague. "The plants find this protein totally innocuous and will crank
out better levels than you can get in a bacterial fermentor," Arntzen said.


Links within this article

Large Scale Biology
www.lsbc.com

A.McCook, "Manufacturing on a grand scale," The Scientist, February 14, 2005.

Charles Arntzen - ASU - Biodesign Institute
http://sols.asu.edu/faculty/carntzen.php

The Biodesign Institute
http://www.biodesign.org/

Biolex
www.biolex.com

Planet Biotechnology
www.planetbiotechnology.com

V Koya, etal, "Plant-based vaccine: Mice immunized with chloroplast-
derived anthrax protective antigen survive anthrax lethal toxin
challenge," Infection and Immunity, December 2005.
PM_ID: 16299323

L Santi, etal, "Protection conferred by recombinant Yersinia pestis
antigens produced by a rapid and highly scalable plant expression
system," Proceedings of the National Academy, Jan. 12, 2006
http://www.pnas.org/cgi/reprint/0510014103v1


                                 PART II
------------------------------- GENET-news -------------------------------

TITLE:  LSBC files bankruptcy
SOURCE: In-Pharmatechnologist, France, by Kirsty Barnes
        http://www.in-pharmatechnologist.com/news/ng.asp?id=65190
DATE:   18 Jan 2006

------------------ archive:  http://www.genet-info.org/ ------------------


LSBC files bankruptcy

18/01/2006 - Large Scale Biology Corporation (LSBC) along with its
subsidiaries Bioprocessing and Predictive Diagnostics, has now filed for
Chapter 11 bankruptcy protection after going bust last month.

However, with assets of approximately $9.8 m ($8.1 m) and debts in the
region of $7.8 m the company expects to be able to pay off all the
creditors and have additional funds left over for shareholders,
according to Robert Erwin, chairman of the company's board of directors.
The creditors include Agility Capital, Kentucky Technology, Woodlawn
Foundation, Seneca Meadows Corporate Center III Limited Partnership,
LSBC's CEO Kevin Ryan and Robert Erwin.

After being unable to bail itself out of trouble with an acquisition or
lisencing partner for its products, LSBC shut down last month after
running out of cash and failing to raise enough money from a bridge
loan, closing its facilities in California and Kentucky and making 69
staff redundant.

The biotech company was a pioneer in the field of plant-produced
medicine involving the use of tobacco plants as biological factories.
Using its biomanufacturing approach, the company inserted the genetic
sequence coding for a desired compound into a virus that infects tobacco
plants.

This tobacco mosaic virus was based on RNA, so it did not combine with
the tobacco plant's genetic material. This did away with the need to
genetically modify the plant, avoiding the high cost and length of time
taken to develop transgenics and also bypassing environmental concerns
about GM material, as many people are alarmed about the potential of GM
traits finding their way into the food chain.

Making pharmaceuticals in crop plants such as tobacco seemed an
attractive proposition because they are inexpensive to grow, and could
produce vast quantities of drugs or vaccines at low cost, potentially
making it possible to make drugs that were not economically feasible before.

But plant-produced medical protein has never been approved by the Food
and Drug Administration before and it was always going to be a challenge
for a company the size of LSBC to source funding to run the costly
clinical trials.

LSBC had several products in development using its biomanufacturing
approach, however, like many biotech companies before it, the company
never really managed to get its products off the ground before going bust.

Many deals with large pharma companies were discussed, in particular for
LSBC's flagship product aprotinin, an anti-inflammatory protein used in
cardiovascular surgery, but these never materialised in time.

Early last year LSBC and Bayer CropScience agreed to enter into a
research and development collaboration to investigate the plant-based
expression of lysosomal acid lipase (LAL) - a plant-derived human enzyme
that breaks down lipids - one of LSBC's pharmaceutical products for
Orphan diseases, but this deal ended up falling through.

Incidentally, last week Bayer acquired another rival company that is
involved in the development and use of engineered plants to create
pharmaceuticals, Germany's Icon Genetics.

LSBC was also involved in a manufacturing deal with privately-held
Planet Biotechnology, to extract and purify the latter's lead product,
CaroRx, a plant-made antibody to control dental caries which was shown
in clinical studies to prevent the adhesion to the tooth surface of
decay causing bacteria, which is currently approved for sale as a
medical device in the European Union.

Planet biotechnology was unable to be contacted to confirm who is now
manufacturing the product.


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