Medical tech company Phylogica (ASX: PYC) has cleared an important hurdle in the development of its patented drug delivery platform.

The company’s operating focus is on improving the complex procedures used to transmit drugs to the eye.

Early-stage results from animal studies have proved they’re onto a winner: Phylogica’s cell-penetrating peptide, or CPP for short, can penetrate cells and safely deliver drugs all the way to the retina.

Shares in the company jumped as high as 3.3c, up 18 per cent, before falling back again.

‘Trojan horse’

Effectively transmitting drugs into target cells is one of the “biggest challenges of modern pharmacology”, Phylogica CEO Rohan Hockings told Stockhead.

Perhaps not surprisingly, drug delivery treatments for eye problems are particularly difficult. It’s also a big market, with eye disease affecting more than 10 million people in the US alone.

“Before you even start on crossing the cell membrane, you’ve got to cross eight layers of other cells; it’s a really complex arrangement before you get to the retinal layer where the disease is occurring,” Hockings explained.

At each step of the way you meet a cell membrane — purpose-built to keep all substances out. That’s where Phylogica’s CPP acts as a “Trojan horse that breaches the defences of the cell”, Hockings said

It can then deliver the drug cargo to the target area, “to stop it expressing the protein that’s causing the disease”.

Phylogica’s tests were successful with a dose of just 1.6 micrograms, which reduces the risk of harmful side effects. But at those small doses, they were also shown to deliver “substantially more drug cargo inside their target cell than the current CPP benchmark”, the company said.

Just getting started

While Phylogica enjoyed a positive early result, the good news is there’s still a lot of development to come.

Hockings said the company has only tested the first half-dozen CPPs from a total of “70 or 80”, which will then give it a macro overview of which CPPs are the most optimal.

The benefits to that are two-fold; it will give the company a strong patent position, as well as a competitive advantage in the market.

“When you’ve got data that a supports a renewed molecule pattern like we’ve just identified, it restarts the clock on our patent protection; we’ll get another 25 years on these CPPs which are already working a lot better than the originals.”

He said the company is also in a unique position compared to most competitors in the space, who are working with only one CPP and making changes to see if it’s better or worse.

“We’ve got these rich drug libraries, so the idea that we’ve got a whole host of CPPs — each one different — should enable us to crack the code for what the best one is.”

“There’s a rolling intellectual property effect if we do it well and the broader we make that, the bigger gap we can lock in against the field.”

Looking ahead

The company is now engaged in ticking the next round of regulatory boxes as it moves towards clinical trials.

The first step is to finish testing its full library of CPPs, which Hockings expects will be completed over the second half of this year.

Phylogica will then transition from testing on mice to larger animals such as rabbits in early 2020, followed by the start of the approval process for the US Food & Drug Administration (FDA).

“We’re looking at about a 12-18 month runway for toxicology testing, then we’ll target a date in 2021 when we move into clinical trials,” Hockings said.