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Medgenics Inc

  • BY: Andrew Hore |
  • POSTED: 11/01/2009 |

2009 could be a significant year for biopharma company Medgenics Inc.

Just before Christmas 2008 Medgenics gained a US patent for its Biopump protein therapy technology. The US is the main target market. Further patent applications are under review in the US and in other countries.

Biopump as a name can be confusing. There is no physical pump involved. It is a technology that uses a patient’s own tissue in order to create a treatment.

Israel-based Medgenics hopes that its tissue therapy technology will replace regular injections as a way of treating and stabilising ailments, such as diabetes, anaemia and hepatitis C. A skin biopsy is taken from a patient and processed for two weeks in order for it to produce the required protein. It is then put back in the body, under the skin. This can provide a sustained dose of the required treatment which can last for weeks or months.

If this is perfected it will be much more efficient and safer because it uses naturally occurring proteins. There are fewer visits to the doctor and it should be easier to extend treatments to additional people. The manufacturing process would be less costly.

The initial treatment being developed is for anaemia because this is such a large potential market. A phase I/II clinical trial is underway and early results from the first few patients are encouraging. The overall trial is planned to cover 24-30 patients and should be completed by the end of 2009.

The product is called EPODURE, because it produces EPO (erythro-protein) to treat anaemia. This is a $12bn a year market. One treatment could last for three-to-six months and avoid haemoglobin cycling, which has been identified as being correlated with increased mortality. Because it is not based on a new drug it should not take as long to gain regulatory approval as a completely new treatment.

The second product in development is INFRADURE, which is designed for the production and sustained delivery of interferon-alpha for the treatment of hepatitis C - a market valued at $3.5bn a year.

Medgenics is backed by high net worth individuals that understand that it will require more cash before it can benefit fully from its technology. That gives it a better chance than many other companies when it comes to raising more money. That is likely to happen later this year.

Medgenics joined Aim on 4 December 2007 when it raised £3.276m at 10p a share.

Over the past year the shares have fallen by 64%. In recent weeks the shares have recovered from a low of 1.75p to 4p a share, which values the company at £4.9m. 

Longer-term, Medgenics will need to find partners to complete the development and commercialise its products. Large pharmaceutical companies will be keen on these products because of the huge addressable markets. Separate partners are likely to be sought for each of the different treatments.

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