Transgene Biotek’ share price up 5% on Aids vaccine update

Transgene Biotek, an Andhra Pradesh-based biotechnology company promoted by Dr K Koteswara Rao, has announced that a vaccine for AIDS that it is working on has passed a key milestone. The drug has proved its effectiveness by selectively killing more than 75% of the gp120 specific B cells within 48 hours of administration, said the company in a statement. “The technology behind the vaccine focuses on the selective killing of a subset of B cells, targeting only those bearing antibodies specific against 120gp antigen of the HIV virus."

According to this entry on GP120 in Wikipedia, it is a glycoprotein that plays a vital role for the HIV virus to enter CD4 cells (cluster of differentiation 4). GP120 was one of the first targets for AIDS vaccine research, according to the Wikipedia entry, but efforts have been hampered because of the chemical structure and properties of GP120.
Transgene’s vaccine, it claims, can prevent the progression of the disease and almost reverses the process of AIDS. It is also said to be safe for the rest of the immune system. It is the first of vaccines to come off Transgene’s platform for building drugs tackling auto-immune diseases, with other conditions like rheumatoid arthritis and multiple sclerosis also being worked upon.

Though not explicitly clear, the statement seems to indicate that the company has got regulatory approvals for advancing the vaccine for further studies. The company will have to put the drug through a series of human trials and satisfy regulators before it can see the light of the day. This is a time consuming and expensive effort, for which it will most likely tie up with a third party. If it does manage to get a strong partner on board, it would be a vindication of its research capabilities.

It would also provide with some much needed income. Its revenues during 2008-09 was Rs 3.6 crore and have been in the Rs 3-4 crore range in the preceding three years too. Its net profit was Rs 3.8 lakh during the year. It has a market capitalisation of Rs 98 crore, which may seem at odds with its size, but reflects the expectations that it might just make a big breakthrough. The company recently tied up with Dr Reddy’s Laboratories, licensing the technology for making Orlistat, an obesity management drug. It has also out-licensed its recombinant Hepatitis B vaccine to the Serum Institute of India.

The stock was up by 5%, touching the upper end of the circuit filter for stocks in the T group.

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