Health: the hits keep coming for Avecho Biotechnology

Avecho Biotechnology (ASX:AVE), the company formerly known as Phosphagenics, announced that its Japanese partner is pulling support after three years of research.

Avecho has a patented drug delivery system called targeted penetration matrix (TPM). Together with Japanese medical devices company Terumo, TPM was being used to deliver propofol, a general anaesthetic used for the induction and maintenance of sedation during surgical procedures.

The companies collaborated on the development of a reformulated TPM/propofol product that was the focus of a joint patent application and formal toxicology program, with the hope it would take off in the Japanese market.

But in terrible news for Avecho, Terumo has pulled out after studies revealed TPM/propofol was not safe over a 24-hour period, with high toxicity. The stock was down 33 per cent in morning trade.

”Disappointingly, the formulation which had passed all other testing to this point was not suitable for long-term infusion,” said Masahito Takahashi, Terumo representative.

“The polysorbate exposure resulting from this length of infusion is higher than in currently approved Japanese products, and the results demonstrate a safety concern which would be difficult to address with the Japanese regulatory authority.

“We have therefore decided not to support further development of TPM/propofol.”

It is a disaster for Avecho, which last year, when known as Phosphagenics, lost almost all of its value after losing a court case against big pharma company Mylan.

The company says it is currently unsure as to whether it will seek to focus on short-term anaesthesia infusions, for which TPM/propofol did prove safe, or tweak the formulation to try long-term infusions again.

Phosphagenics loses court case, shares plunge 89pc

In more ASX health news today:

Cynata (ASX:CYP) ends takeover discussions with Sumitomo. Cynata received a takeover offer from Japanese pharma company Sumitomo, valuing the company at about $200 million, but told the market this morning it had killed talks as Sumitomo could not offer it a deal attractive enough.

Mesoblast (ASX:MSB) finds a manufacturing partner. Stem cell biotech Mesoblast has signed an agreement with Lonza for the commercial manufacture of its lead stem cell product remestemcel-L for the treatment of pediatric steroid-resistant acute graft-versus-host disease.