Cancer drug maker eyes future growth in revenue

DIVERSITY::GlycoNex Inc said that as well as developing new pharmaceuticals, it will seek to bring in additional revenue streams through providing technology services

By Camaron Kao  /  Staff reporter

Mon, Dec 03, 2012 - Page 14

Cancer-medicine developer biotechnology firm GlycoNex Inc (台灣醣聯生技) said on Friday that it aimed to develop one new drug every two to three years to grow revenue after a major cancer drug was approved to enter clinic trials via its Japanese partner.

The drug, GNX-8, which could be used to treat colorectal cancer, has entered phase one of clinical trials, chairman Tong Chang (張東玄) told investors at a conference before the company’s shares debut on the main bourse on Dec. 18.

GlycoNex is expected to obtain a significant amount of revenue from GNX-8 next year after the drug entered clinic trials, company spokesman Roger Lu (呂耀華) said by telephone.

Lu declined to comment on media speculation that it would receive US$4 million for the trials next quarter.

“As we continue to generate revenues from licensing drugs and providing technology services, GlycoNex’s revenue structure is stronger than our peers,” Lu said.

In 2009, GlycoNex transferred the technology to make the GNX-8 therapeutic drug — a fully human monoclonal antibody — to Japanese pharmaceutical company Otsuka Pharmaceutical for an initial payment of US$3 million.

The firm will receive certain “milestone payments” of US$196 million during the various clinical trial stages, it said.

The company will also collect royalty payments based on the sales of the drug from Otsuka after it is put on the market.

GlycoNex, based in Sijhih District (汐止), New Taipei City (新北市), was set to launch an initial public offering at a price tentatively set at NT$105 per share.

Shares of GlycoNex closed 0.89 percent lower at NT$167 on Friday on the Emerging Stock Market.

The stock has risen 164.82 percent so far this year, according to the stock exchange’s data.

GlycoNex’s core business is developing monoclonal antibody drugs in their early stages and licensing them to pharmaceutical companies.

The company’s technology can minimize side effects as it can differentiate cancer cells from normal cells, Chang said.

As a result, GlycoNex drugs can produce antibodies specifically targeting cancer cells, while leaving normal cells unharmed.

In addition, GlycoNex expects to complete animal testing for two new drugs — GNX101 for treating ovarian cancer and GNX 102 for treating gastric cancer — by the end of this year and enter clinical trials by 2016, Chang said.

Another two drugs — GNX103 and GNX 104 — are to complete animal testing by 2014, Chang said.

GlycoNex was diversifying its revenue sources by providing technology services, Lu said.

The company estimates that the percentage of its revenue obtained from technology services will be 5 percent this year and would increase to 15 percent next year and to 35 percent in 2014, Lu said.

Lu also said that the company swung into the black in October after receiving a significant payment from Mitsubishi Gas Chemical Co Inc for technological services.

GlycoNex lost NT$26.29 million (US$904,368) in the first six months of this year.

The company made NT$19.61 billion in net profits last year.