Biotech company Proteomics International Laboratories (ASX:PIQ) is pressing forward with multiple major upside opportunities as a key health test internationalises and an options issue unfolds.
The company’s proteomics-based technology platform is developing next-generation diagnostic tests based on differences in the protein make-up of people with and without a particular disease.
The method can be applied to allow for personalised medicine treatments or to improve agricultural results. The Company is also rewarding shareholders with a 'loyalty options' issue this month, with the issue fully underwritten and raising A$126,450.
Other signs of traction have included the signing of a protein analysing contract in April with a $330 million Australian milk company and steady development of PIQ’s flagship product: a ground breaking predictive test for the diagnosis of diabetic kidney disease (DKD).
A product with potential
Marketability of PromarkerD is supported by growing rates of DKD and the fact that there is currently no available test for predicting the onset of the disease.
“The current gold standard urine-based test for DKD is not robust, with results differing simply by taking a walk around the block before being tested,” PIQ managing director Dr Richard Lipscombe explained.
“In contrast PromarkerD is also both a robust and sensitive diagnostic test. It can detect people with severe or mild kidney disease, and also detect individuals missed by the existing tests.” Critically, PromarkerD differs in that it also offers a prognostic (predictive) test.
PromarkerD’s capacity to generate cash via licensing fees, upfront payments and royalties is strengthened by a diversified range of commercialisation options in various niche diagnostic test applications.
Avenues for monetising the technology have been identified in a range of medical applications, including specialist diagnostic tests run by clinical laboratories, clinical pathology tests produced by diagnostic companies and companion diagnostic tests used to monitor a patient's response to drug therapy.
PIQ is in a strong position regarding commercialising this intellectual property, with patents pending in major jurisdictions for PromarkerD.
The company has recently cited pending international deal activity, including a commercialisation agreement in China and engagement with U.S. pharma.
Expanding worldwide markets
PIQ represents a first mover in technology aimed at enormous and rapidly growing markets. These include the proteomics market (expect to be worth $20.8 billion by 2018), the therapeutic peptide-based drug market (currently $17 billion) and the diagnostics (biomarkers) market, which is projected to grow from a value of $24.1 billion to $45.6 billion by 2020.
Diabetes is the fastest growing medical problem in the world today, and all regions of the planet are affected. Of global markets, the incidence of DKD is worst in the U.S., but China and India are expected to overtake it in the near future.
This trend has resulted in a global marketing strategy for PIQ, with the company already progressing partnerships and client relations in Australia, India, China, the U.S., Middle East, Japan, and throughout South-East Asia.
According to the International Diabetes Federation, there are 387 million people currently living with diabetes and that number will grow by 200 million in the next 20 years. DKD is one of the major complications of the disease, and its prevalence is growing at, at least the same rate.
Analysis
The commercial potential of PromarkerD is vast because the test is both versatile and adaptable in the context of a rapidly growing diabetes market.
Existing tests in this market are only diagnostic, detecting disease only after clinical symptoms have started to appear. In contrast, PromarkerD can predict months in advance which patients will go on to have a significant decline in kidney function, thereby allowing medical intervention to prevent that happening.
Product diversification is planned to expand the PIQ business model beyond PromarkerD, with an R&D program likely to pursue multiple new diagnostic targets over the next 12 months.
The company is currently vetting opportunities in a range of medical areas as well as in agriculture.
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