ANNUAL REPORT - Pevion Biotech AG

2005 

ANNUAL REPORT 

Pevion Biotech Ltd. 

Rehhagstrasse 79 

CH-3018 Bern 

Switzerland 

Phone +41 31 980 62 03 

Fax +41 31 980 66 18 

info@pevion.com 

www.pevion.com

INDEX 

LETTER FROM THE CEO ......................................................................................3 

HIGHLIGHTS IN 2005 ............................................................................................4 

COMPANY PROFILE .............................................................................................5 

PRODUCT DEVELOPMENT..................................................................................6 

LEAD PROJECTS ...................................................................................................9 

Pevion Biotech_Annual Report2005_01_01_04_004 2/13

LETTER FROM THE CEO 

2005 ANNUAL REPORT 

Dear Shareholder 

Vaccines are one of the fastest growing market segments in the healthcare 

industry. Especially therapeutic and cancer vaccines contribute to this 

market growth. Currently, there are anti-cancer products based on passive 

immunization with antibodies on the market. However, this type of vaccines 

requires an expensive production process that leads to high prices on the 

market. In the future, these treatments will be joined by more economical 

vaccines based on tumor antigens. Pevion Biotech’s validated technology 

and development process according to industrial standards enabled us to 

start the product development of cancer vaccines in early 2005. Due to an 

accelerated development process Pevion Biotech was able to reformulate a 

very promising breast cancer antigen according to GMP standards in a short 

period of time. The product candidate, which is developed in cooperation 

with Bio Life Science in Vienna, is scheduled to enter the phase I clinical 

study in Q2 2006. 

In 2005 Pevion Biotech also reached important milestones in the field of 

prevention and therapy of infectious diseases. The malaria vaccine candidate 

entered clinical phase II, and in addition the HCV vaccine candidate is ready 

to enter clinical phase I in Q3 2006. 

In 2005 the company followed its aggressive patent strategy and submitted 

2 technology and product patents respectively. 

With regard to the life cycle management of the virosome technology, 

Pevion Biotech established a new process for the production of fully 

functional lyophilized virosomes. This process improved the stability 

characteristics of virosome vaccines and furthermore boosted doctor 

compliance. Lyophilized virosome products can be stored even at room 

temperature, overcoming common stability issues known for most vaccines. 

After reconstitution, the lyophilized virosome formulated vaccine is still fully 

active. The lyophilization process will bring us one step further towards the 

creation of high potential and premium virosome vaccines. 

As a matter of fact, Pevion Biotech’s key strengths predominantly lie in 

market-approved virosome technology, which benefits from strong patent 

protection. The industrial experience and the broad applicability of this 

carrier enable an accelerated product development process. Together with 

their excellent safety profile, which also includes broad market experience 

with children, the elderly and immune-suppressed persons, the resulting 

vaccines will be a competitive advantage in the market. In 2006, our 

company will further strengthen its product pipeline and will be well 

positioned on the way to create considerable added value in 2006. 

Sincerely, 

Peter Klein 

CEO Pevion Biotech AG 


HIGHLIGHTS IN 2005 


� Important steps forward in clinical development 

Pevion Biotech’s lead product, a multi-component malaria vaccine 

candidate, entered clinical Phase II. Positive interim results concerning 

immunogenicity and safety were announced in December 2005. 

� Achievements in product development 

In 2005 two projects reached preclinical status and are ready to enter a 

clinical phase I trial. One project aims for the development of a breast 

cancer vaccine, a collaboration with Bio Life Science, Vienna, and another 

project involves the HCV therapeutic vaccine candidate, representing Pevion 

Biotech’s approach for a multi-epitope and personalized therapeutic 

regimen. 

� New vaccine candidate in the pipeline 

To strengthen Pevion Biotech’s pipeline, a diphtheria/tetanus vaccine was 

integrated into Pevion Biotech’s development plan. The vaccine candidate 

will be a premium booster vaccine for adults and have a considerably higher 

safety profile than conventional applications currently available in the 

market. 

� Increased stability for virosome vaccines 

In 2005 a new virosome-manufacturing process called lyophilization was 

established. This process is a groundbreaking innovation for virosome 

technology. It improves the stability and the formulation of pharmaceutically 

active substances. 

� GMP certificate for manufacturing 

Pevion Biotech’s quality system was approved by the national registration 

authority Swissmedic, and the certificate of GMP Compliance of a 

manufacturer was issued. It certifies that Pevion Biotech is authorized to 

manufacture up to Phase III clinical trial products in collaboration with Berna 

Crucell. 

� Newly established strategic collaborations 

Pevion Biotech’s virosome carrier/adjuvant technology platform provided 

the basis for a number of strategic alliances with international biotechnology 

companies, including Innogenetics (INNX; Ghent Belgium) and Mymetics 

(MYMX; NYC, NY). 

Additionally, Pevion Biotech signed an option agreement for an exclusive 

license with Vivalis SA. The license grants a more favorable production 

process of Hemagglutinin, an important component of Pevion Biotech’s 

virosome technology. 

� Intellectual property 

Pevion Biotech further extended its patent portfolio by filing two 

applications covering specific aspects of its virosome carrier. The IP portfolio 

grew in 2005 to eleven patent applications. Additionally, the company has 

exclusive licenses for four patent families with more than 90 granted patents. 

In 2005 the company became registered owner of the trademarks “Pevion”, 

“Pevion Biotech”, “PeviPRO TM” , “PeviTER TM ” and “Pevi TM ” in Switzerland, the 

United States and the European Union. 


COMPANY PROFILE 


“We are a dedicated Swiss biopharmaceutical company focusing on the 

treatment and prevention of major infectious diseases and cancer. 

Decisive success factors are an accelerated development process in 

accordance with industrial standards using our established and marketapproved 

virosome technology.” 

Peter Klein, CEO Pevion Biotech 

Pevion Biotech was founded as an industrial spin-off by Berna Biotech AG 

and Bachem Holding in 2002. Since the foundation of the company Pevion 

Biotech has been strengthening its pipeline to focus on major infectious 

diseases of high unmet medical need. Currently, product development is 

ongoing for malaria, breast cancer, hepatitis C, Alzheimer’s disease, RSV and 

diphtheria/tetanus. 

As an industrial development company with a market-approved virosome 

technology, Pevion Biotech possesses advantageous tools for an 

accelerated product development. During the last 3 years Pevion Biotech 

advanced its products from an early development stage into a preclinical or 

clinical stage. As a result, the company’s lead project, the malaria vaccine 

candidate, entered clinical testing only 2 years after founding the company 

and reached clinical phase II in 2005. 

Moreover, in 2005 the first cancer vaccine entered Pevion Biotech’s pipeline. 

The project is being conducted in collaboration with our competent partner 

Bio Life Science, Vienna. The development company is specialized on cancer 

treatment and prevention and is strongly connected with the research 

facilities and the clinical department of the University of Vienna. The product 

will already enter into clinical phase I in Q2 2006. In the future, Pevion 

Biotech will further intensify collaborations in the area of therapeutic and 

prophylactic cancer vaccines. Additionally, Pevion Biotech has substantially 

invested in the improvement of virosome technology resulting in a number 

of new technology applications and enhancements protected by own 

patents. 

By the end of 2005 the company had a staff of 17 full-time employees, seven 

of whom have a Ph.D. degree. Nearly all of them are dedicated scientists or 

technicians who promote the R&D projects of the company under the 

management of an experienced executive team and a renowned scientific 

advisory board. 

Pevion Biotech has the most complete patent portfolio regarding virosomes 

(11 patent families and over 90 granted national patents) covering all aspects 

and applications of the virosome technology platforms. Additionally, the 

company has 5 patent families covering the antigens used in its products. 


PRODUCT DEVELOPMENT 


“The development of lyophilized virosomes is a very exciting step 

forward for Pevion Biotech. It will result in a new generation of virosomes 

and open up new attractive opportunities in the field of prophylactic and 

therapeutic vaccines.” 

Dr. Rinaldo Zurbriggen, CSO Pevion Biotech 

Clinical development 

Pevion Biotech has highly efficient and flexible development processes that 

meet industrial standards. Together with appropriate resources (e.g. access 

to a GMP pilot facility for the production of virosome-formulated vaccines 

for clinical use), these processes enable an accelerated and productorientated 

development through clinical Phase I/II. This was shown when the 

company started its first clinical trial only two years after its founding and 

completed testing with all endpoints achieved two years later in 2004. The 

malaria vaccine candidate entered clinical phase II in 2005. 

Identification and selection of new product candidates 

Pevion Biotech is dedicated to accelerating the selection and preclinical 

development of new vaccine candidates by targeting a range of unmet 

medical needs. Resource-intensive and costly antigen identification and 

validation are performed by external partners. In 2005 Pevion Biotech 

actively developed six product candidates, and it is continuously screening 

the market for potential new antigen targets to be combined with its carrier 

platform. Promising target antigens in terms of medical need, market 

potential, expected clinical development time as well as technical feasibility 

will be formulated with Pevion Biotech’s virosomes, and the efficacy of the 

resulting product candidates will be evaluated in small animal models. 

Life cycle management of virosome technology 

Although virosome technology already has an extended application area 

(e.g. delivery function), Pevion Biotech sees great potential for an even 

broader spectrum for virosomes in pharmaceutical applications. New 

indications will challenge virosome technology and Pevion Biotech will 

promote the constant improvement of its technology. An example is the 

recent groundbreaking innovation, the “lyophilization of virosomes”, which 

improves the stability and formulation of pharmaceutically active substances 

in virosome technology. 


THE VIROSOME TECHNOLOGY 


“The company has developed new generations of virosome carriers, 

which are protected by sets of patent applications filed within the last 

years. These new assets position the company favorably to maintain a 

competitive edge and generate revenues over an extended period 

time.” 

Dr. Thomas. Stauffer, COO Pevion Biotech 

Market-approved modular vaccine design 

Pevion Biotech’s virosome technology is a market-approved carrier system 

for the delivery of pharmaceutically or immunologically active substances. 

This predominantly synthetic carrier and adjuvant system is broadly 

applicable with almost any given drug or antigen. Based on this technology, 

Pevion Biotech has developed three proprietary platforms: PeviPRO TM , 

PeviTER TM and PeviPHAR. Each of these aims at a different type of vaccine or 

delivery system. Two virosome-based vaccines Epaxal® (Hep A) and 

Inflexal® V (Influenza) have been registered in Europe and other countries 

including Canada, Australia etc. by Berna Biotech. 

Figure 1: Modular PeviPROTM virosome vaccine design by Pevion Biotech: antigens, 

DNA or drugs of interest are combined with a lipid anchor, which enables the 

attachment on the surface of virosomes. 

Pevion Biotech’s virosome technology has outstanding characteristics with 

regard to versatility and functionality. This predominantly synthetic carrier is 

applicable with a wide range antigens including proteins, peptides, DNA or 

even drugs (cytostatics, etc.). Possible B-cell antigens are coupled with lipid 

anchors and can afterwards be formulated with virosomes. This simple 

concept, which is based on a sophisticated technology and specific knowhow, 

allows Pevion Biotech to rapidly generate a broad spectrum of new 

vaccine candidates. 


Ultrastructure of virosomes 

Virosomes are spherical, unilamellar vesicles with a mean diameter of 150 

nm. Essentially, virosomes represent reconstituted empty influenza virus 

envelopes devoid of the nucleocapsid 

including the genetic material of the source 

virus. Virosomes are not able to replicate but 

are pure fusion-active vesicles. They function 

as both carrier platforms and adjuvants. In 

contrast to liposomes, virosomes contain 

functional viral envelope glycoproteins: 

influenza virus hemagglutinin (HA) and 

neuraminidase (NA) intercalated in the 

phospholipid bilayer membrane. The unique 

properties of virosomes partially relate to the 

presence of these glycoproteins. They not 

only confer structural stability and 

homogeneity to virosome formulations, but 

they significantly contribute to the 

immunological properties of virosomes, which 

are clearly distinct from other liposomal and 

proteoliposomal carrier systems. These 

proteins enable the virosome membranes to 

fuse with cells of the immune system and thus 

deliver their contents – the specific antigens – 

directly to their target cells, eliciting a specific first-class immune response 

even with weak-immunogenic antigens. Once they have delivered the 

antigens, the virosomes are completely metabolized, whereas the 

conventional adjuvant aluminum stays in the body. Thus virosomes are an 

efficient and safe carrier and adjuvant system. 

PeviPRO TM 

PeviPRO TM is Pevion Biotech’s proprietary virosome carrier platform for the 

development of antigen-specific prophylactic vaccines. Vaccines based on 

PeviPRO TM generate high quality humoral immune responses and longlasting 

protection, even with weak immunogens (for instance peptide 

antigens). A main focus in Pevion Biotech’s own developments is the 

PeviPROTM-based malaria vaccine, which completed clinical Phase I in Q2 

2005. 

PeviTER TM 

Hemagglutinin 

Neuraminidase 

Phosphatidylcholine 

Phosphatidylethanolamine 

Figure 2: Ultrastructure of 

virosomes 

PeviTER TM is Pevion Biotech’s proprietary virosome carrier platform for the 

development of T-cell antigen specific therapeutic vaccines against chronic 

infectious diseases as well as other diseases including cancer. Vaccines 

based on PeviTER TM generate a highly specific cellular immune response. 

Pevion Biotech’s hepatitis C (HCV) vaccine uses the PeviTER TM approach by 

encapsulating T-cell epitopes into virosomes and exposing them to the 

immune system via the MHC class I/II pathway. 

PeviPHAR 

PeviPHAR is Pevion Biotech’s proprietary technology platform for drug 

antisense and DNA delivery. Using specific receptors/ligands or 

antigens/antibodies interactions, the virosomes will be targeted to specific 

cells. Drugs, encapsulated into virosomes, will mainly be delivered to the 

targeted cells, which will reduce the amount of the drug used and will also 

diminish the toxic effects. A main focus is the site-specific delivery of 

cytostatics in cancer therapy. 


LEAD PROJECTS 


Development pipeline of Pevion Biotech 

In 2005 Pevion Biotech was able to further strengthen its product pipeline for 

major infectious diseases of high unmet medical need. 

Breast cancer 

Breast cancer 

Alzheimer’s disease 

RSV 

Hepatitis C 

Malaria 

DiTe 

Research 

Development 

Preclinic 

Clinic I 

Clinic II 

Pipeline Pevion Biotech Dec. 2005 

Breast cancer is one of the most common cancers among women 

worldwide. It strikes women of all ages, races, ethnicity, socioeconomic 

strata, and geographic locations. More than 1.2 million people will be 

diagnosed with breast cancer this year worldwide (WHO). The incidence of 

breast cancer has continued to increase about one-half percent per year 

over the past 40 years while the mortality rate persists; this occurs especially 

in many European countries. Breast cancer occurs in men also, but the 

number of new cases is small. Currently, surgery combined with radiation 

and/or chemotherapy is the most common treatment for breast cancer. 

During radiation and/or chemotherapy patients suffer from severe side 

effects. Additionally, specific hormone therapies are applied. 

Pevion Biotech is seeking to develop a vaccine which is able to actively 

immunize cancer patients. The cancer vaccine is based on the 

overexpression of the HER-2/neu oncoprotein. The induction of an antitumor 

humoral immune response by peptide vaccination would generate 

immuno-prevention of tumors in healthy individuals with a high risk of cancer 

and/or would prevent tumor relapse in patients with minimal residues of the 

disease following resection of solid tumors. The benefit for patients and 

health economics from such a vaccine is evident. 

Together with Bio Life Science, Vienna, Pevion Biotech is developing a multiepitope 

vaccine which is able to inhibit tumor cell growth. Within this 

relatively young project, which started in January 2005, Pevion Biotech 

achieved significant milestones which showed the efficacy of the peptide 

vaccine in a living organism. These very convincing results enabled the 

company to move the project within one year from the concept phase into 

preclinical development. A clinical trial phase I is planned for Q2 2006. 


Alzheimer’s disease 

Alzheimer’s disease is one of the leading causes of dementia, a worldwide 

problem. This neurodegenerative disease disrupts cognitive and memory 

abilities and memory by the progressive accumulation of Aß peptides in 

areas of the brain serving cognitive functions. AD affects about 10% of the 

world’s population above 65 years of age. In this population there are 

currently about 8.3 million Alzheimer’s patients. As age advances, the 

incidence increases rapidly. One in 10 persons over 65 years of age and 

nearly half of those over 85 years of age suffer from AD. 

Primary prevention of Alzheimer's disease is not possible at present. 

Currently marketed products only provide partial and temporary relief from 

AD’s symptoms. They have failed to live up to the public's high expectations 

and offer such modest benefits that many doctors have doubts about 

prescribing them. Accordingly, there is no satisfactory cure for this disease 

and there is a large demand for an effective therapeutic vaccine. 

Alzheimer’s disease is a dementia that is defined by the presence of 

extracellular amyloid plaques in the brain, composed mainly of amyloid 

peptides. Several studies in transgenic mouse models of Alzheimer’s disease 

have revealed the potency of vaccination to prevent or even clear amyloid 

plaques Aß from mouse brain. Pevion Biotech’s Alzheimer’s disease vaccine 

is based on a conformationally optimized Aß epitope which is formulated 

with PeviPRO TM to favor a highly specific antibody immune response. Pevion 

Biotech’s vaccine candidate is currently in preclinical development. The 

manufacturing of the vaccine under GMP standard is currently established 

including the corresponding analytical methods. 

Currently, the company is seeking partners for this project which aims to 

keep focusing on its key competences like prevention and treatment of 

infectious diseases. 

Malaria 

Malaria is one of the major public health challenges in the world’s 

developing countries. It is endemic in a total of 101 countries and territories 

across Africa, Asia, Eastern Europe and South America, inhabited by a total 

of 2.4 billion people – 40% of the world's population. Among the three 

different pathogens, Plasmodium falciparum is the most dangerous one. 

Each year, 300 to 500 million malaria infections occur and more than 2 

million people die. The vast majority of deaths occur among young children. 

Malaria has worsened in recent decades because some strains of the malaria 

parasite have developed resistance to drug treatments and mosquitoes have 

become impervious to insecticides. 

The malaria parasite Plasmodium falciparum has a complex life cycle 

involving three stages in the human body - the pre-erythrocytic stage, the 

blood stage and the sexual stage. The different stages are “visible” on the 

parasite itself, since it expresses stage-specific proteins on its surface. These 

proteins quite often bear antigens, which are prime targets for a malaria 

vaccine. Thus it is possible to design a vaccine specific for each stage. It is 

Pevion Biotech’s goal to develop a vaccine through which the parasite is 

attacked in different stages of its life cycle. It therefore focuses on a multicomponent 

(multi-valent) malaria vaccine: each component targets another 

antigen specific for a defined development stage. Such a multi-component 

vaccine induces synergistic protective effects and reduces the chance of the 

selection of resistant strains. Pevion Biotech uses its well-established 

virosome technology platform PeviPRO TM for the delivery of the newly 

developed peptide antigens. Pevion Biotech tested and optimized malaria 

peptides for their application as component of a multi-valent malaria 

vaccine. In consequent steps the company developed the vaccine 

formulations to clinical phase II which started in Q4 2005. 


This project was supported by the CTI (Swiss Innovation Promotion Agency) 

HCV 

Hepatitis C is a global epidemic and affects 200 million people worldwide. 

The virus is transmitted via blood contact. About 70% of infected persons 

develop chronic hepatitis and many of those are at risk of developing liver 

cirrhosis (20%) and/or liver cancer (1-5% per year). HCV infection is 

responsible for 50-75% of all liver cancer cases and two thirds of all liver 

transplants in the developed world. Currently, there are neither prophylactic 

nor therapeutic vaccines available to prevent or treat hepatitis C infection 

and there is a great need for new treatment options of the disease with 

higher efficacy and improved safety profiles. 

Pevion Biotech is developing a personalized therapeutic HCV vaccine based 

on the PeviTER TM technology. Pevion Biotech’s vaccine is based on virosome 

formulations with selected conserved peptide epitopes where the CTL 

epitopes are encapsulated into the virosomes and the helper T cell epitopes 

of choice are presented at the surface of the virosome. CTL epitope-based 

vaccine approaches offer a number of potential advantages. These include 

safety aspects and the possibility to induce an immune response directed 

solely against the relevant epitope. The main advantage of Pevion Biotech’s 

approach is that the vaccine is personalized, i.e. individually tailored to each 

patient’s needs. It uses a set of peptides individual for each patient instead 

of one peptide or protein. Moreover, the cost-effective peptides can be 

selected according to the HLA phenotype and the specific virus subtype of 

each patient. This personalized medicine is specifically possible, since the 

carriers (virosomes) can be easily lyophilized and reconstituted with the 

peptide antigen of choice. This allows a cheap and efficient management of 

this “off-the-shelf” vaccine. In 2005 the vaccine entered preclinical 

development and will be ready for a clinical Phase I in Q3 2006. 

RSV 

Respiratory syncytial virus (RSV) has a high prevalence in developed 

countries. Although RSV is traditionally regarded as a pediatric pathogen, 

RSV can also cause life-threatening pulmonary disease in the elderly and 

also in immuno-suppressed patients. The disease is as prevalent in the 

elderly and high-risk adults as influenza. Approximately 5% of elderly people 

become infected with RSV every year, leading to pneumonia in around 10- 

55%. The very young are also at high risk. By the age of two years, almost all 

children have been infected with RSV; approximately 50% have been 

infected twice. Premature infants, infants with chronic lung or congenital 

heart disease and immuno-suppressed children are at particular risk of 

getting severe RSV disease. There is currently no prophylactic vaccine for the 

prevention of RSV. Due to the high incidence of RSV infections and the lack 

of treatment alternatives for elderly people, Pevion Biotech identified a 

fundamental goal in the development of a vaccine for this target group. The 

prophylactic vaccine against RSV is based on Pevion Biotech’s proprietary 

PeviPRO TM technology platform. In 2005 the vaccine candidate reached the 

conceptual development phase. 

Diphtheria / Tetanus (DiTe) 

Diphtheria and tetanus are severe infectious diseases. Even with treatment, 

one in ten persons dies from diphtheria. Tetanus also leads to death unless 

intense supportive treatment is rapidly initiated. These diseases are rare in 

industrialized countries, but the risk of importation of toxigenic strains 

persists, and epidemics still occur in developing countries. Vaccinations and 

booster vaccinations will therefore be necessary into the foreseeable future. 

There are quite a number of DiTe vaccines on the market. All of these 

vaccines are formulated with the adjuvant aluminum hydroxide, which might 

be responsible for the unfavorable side effects (swelling, redness, pain) 


attributed to these vaccines. Since the target population is quite large 

already, rare side effects will propagate often. Pevion Biotech’s DiTe vaccine 

will show a more favorable side effect profile than the currently marketed 

products. The vaccine will be reformulated and will enter preclinical 

development in Q1 2007. 


Pevion Biotech Ltd. 

Rehhagstrasse 79 

CH-3018 Bern 

Switzerland 

Phone +41 31 980 62 03 

Fax +41 31 980 66 18 

info@pevion.com 

www.pevion.com

ANNUAL REPORT - Pevion Biotech AG

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