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Published 23 September 2013 11:39, Updated 26 September 2013 12:07
QBiotics’ oncology drug has already treated tumours in over 300 domestic pets, as well as four Tasmanian devils. Photo: Peter Rae
Biotech companies are notorious for being all-or-nothing investments, but Queensland life sciences company QBiotics is trying to give shareholders a middle ground by having its flagship oncology drug registered for use by vets as well as doctors.
Many of QBiotics’ 750 shareholders, who have poured $16.3 million into the unlisted company since 2010, are the owners of pets who have had cancerous tumours successfully treated by its EBC-46 oncology drug. The company claims its treatment provides fully localised tumour treatment, without the complications that can arise when a drug travels throughout the body.
QBiotics is still about six months away from commencing clinical phase 1/2 trials of EBC-46 in humans for eventual registration by America’s Food & Drug Administration (FDA). However, EBC-46 as a veterinary product is already in mid clinical development for eventual registration with the FDA’s Centre for Veterinary Medicine (CVM)
It costs only $4 million to $5 million to have a drug registered by CVM compared to “$400 million or $500 million” for human-use drugs, according to QBiotics’ corporate finance manager, Reuben Buchanan (who became an investor and ultimately an employee after his brother’s dog was successfully treated by EBC-46).
“Back in 2010, we were definitely more of an ‘all-or-nothing’ company but with the high potential of veterinary market registration for EBC-46, a lot of the risk normally associated with early stage biotech companies has been taken out,” Buchanan says.
Without an institutional backer, the company has just raised $6.3 million through a private prospectus that will help fund preclinical trials of a second oncology drug, EBC-23, and research and development into a treatment for chronic wounds, WH-1.
“According to PricewaterhouseCoopers’ BioForum Review, this is the seventh largest capital raising of 2013 for any ASX-listed or private Australian biotech company,” Buchanan says.
“The prospectus was marketed to existing shareholders as well as through other investors networks such as Wholesale Investor. We had approximately 270 invest with amounts ranging from $10,000 up to $500,000 from individual investors.”
The company will consider an initial public offering but wants to achieve milestones such as the veterinary registration of EBC-46 first.
Buchanan says the commercialisation of the vet drug should occur within 18 months. QBiotics will partner with a large vet pharma group to assist with commercialisation, then sales and distribution first in the US and later globally.