(206A) PRISM BioLab - New Analyst Report 7/5

PRISM BioLab is developing low molecular weight pharmaceuticals that control protein-protein interaction (PPI) within cells using low molecular weight organic compounds that mimic peptides using unique “Pepmetics (Peptide Mimetics)” technology.

Within cells, various proteins transmit signals in response to stimulation from outside the cell, and are transmitted to DNA in the cell nucleus to generate mRNA, and new proteins are generated by translating mRNA information.

PPI plays an important role in intracellular signal transmission, and since abnormalities cause disease, it is a target for drug discovery to treat diseases. Antibody pharmaceuticals are used to control proteins outside cells, but since antibody pharmaceuticals have a large molecular weight, they cannot enter the cell.

Meanwhile, conventional low molecular weight pharmaceuticals can enter cells, but since they have a planar structure, it is difficult to bind to proteins with a three-dimensional structure, and they are not compatible with drug discovery targeting intracellular PPI.

PRISM BioLab's pepmetics technology is a technology for creating peptide-mimicking low molecular organic compounds with a wide variety of three-dimensional structures by combining amino acid side chains with a skeleton that mimics the helical helix structure frequently used to bind proteins. The prepared low molecular weight organic compounds bind to target proteins in cells and have pharmacological effects by inhibiting binding to PPI partner proteins due to the action of amino acid side chains.

Using PepMetics technology, it is theoretically possible to design 0.2 billion 50 million or more compounds by combining 40 or more types of backbones, 50 or more amino acid side chains, and 3 to 5 side chain positions. The company has secured such compound designs as virtual libraries, and has 0.02 million or more of these as libraries that can actually be synthesized as compounds and evaluated for activity, pharmacological effects, etc. The virtual library can be used for simulating binding conditions to target proteins and for efficient synthesis of compounds.

PRISM BioLab utilizes a drug discovery platform using Pepmetics technology to develop two business models: in-house development business and joint development business.

In its in-house development business, the company selects drug discovery targets, creates initial compounds (hit compounds) active against drug discovery targets, optimizes hit compounds to clinical candidate compounds, and derives them to pharmaceutical companies while proceeding with non-clinical testing stages such as animal experiments. As income, it is a high-risk/high-return business model where a contract lump-sum payment at the time of derivation, milestones corresponding to development, and royalty income from sales after sales are obtained.

In the joint development project, hit compounds are created and compounds are optimized using PRISM BioLab's Pepmetics compound library for drug discovery targets selected by partner pharmaceutical companies. As income, we earn contract lump-sum payments, joint research income, and royalties for milestones and sales corresponding to development. The total amount of revenue from the development pipeline is smaller compared to in-house development businesses, but PRISM BioLab's investment is small, and it is a business model where early monetization can be anticipated.