The acquisition of BaroFold is a critically important transaction for Pressure BioSciences Inc. (OTCQB:PBIO), one that should have both immediate and long-term benefits for PBI and it shareholders. BaroFold’s patented Pressure-Enabled Protein Manufacturing (PreEMT) technology employs high pressure to disaggregate and control the refolding of proteins to their native structures at yields and efficiencies not achievable using other technologies. The deal looks to be a strategic coup for Pressure BioSciences, locking up a key technology process partner while conserving precious cash.
“We are pleased that the BaroFold technologies are now in the hands of PBI, the leading high-pressure life sciences company in the world,” said Kyle Lefkoff, Chairman of the Board of BaroFold. “Because of our enthusiasm for and confidence in this combination, we requested that the majority of the BaroFold purchase price be paid in restricted common stock of PBIO. We are pleased to be shareholders in this very exciting company.”
Understanding PreEMT Technology
BaroFold has successfully licensed PreEMT to leading worldwide pharmaceutical and life sciences companies, including Boehringer Ingelheim and Lonza, and we view the acquisition of BaroFold as a significant step in expanding Pressure BioSciences’ footprint as the global leader in high pressure technologies. Through this acquisition, Pressure BioSciences adds eight issued and several pending patents in several important areas for biologics research and manufacturing, including protein folding, refolding and disaggregation. The acquired intellectual property complements Pressure BioSciences’ 15 current pressure-related patents and further enables Pressure BioSciences to grant licenses to third parties to utilize PreEMT and other technologies in both research laboratories and in biopharmaceutical manufacturing.
The production of biopharmaceutical products involves complex manufacturing processes that typically lead to large-molecule proteins. The production process can lead to the undesirable aggregation or misfolding of proteins. Such proteins typically lack the desired therapeutic activity and can even present health risks to patients. Protein aggregation or misfolding has been linked to a spectrum of neurodegenerative diseases, including Alzheimer’s disease, Parkinson’s disease, amyotrophic lateral sclerosis (ALS, or Lou Gehrig’s disease) and Huntington’s disease.
Conventional methods of restoring or refolding proteins back to useful structures, including dialysis and dilution, are repetitive, time consuming, trial and error processes that typically result in low recovered yields. BaroFold’s PreEMT technology improves the manufacturing quality of protein biologics while decreasing costs by as much as $2 million to $10 million per year per commercial drug. PreEMT exposes aggregated proteins at any stage in the manufacturing process to elevated pressure, at which point water is forced into the aggregate, causing the proteins to revert to their most compact form, usually their native state. Biologically active, native proteins are then recoverable by researchers within hours at yields as high as 100%, even at high protein concentrations.
BaroFold has demonstrated that the resulting proteins, now free of aggregates, facilitate protein crystal formation, resulting in highly homogeneous crystals ideal for sustained delivery and other life-cycle management initiatives. PreEMT fits neatly with Pressure BioSciences’ existing portfolio of high pressure instruments, worldwide customer base and recently expanded sales force. It seems very clear that BaroFold found the ideal partner to maximize PreEMT’s rather large and exciting market potential.
Unique Market Synergies for Pressure BioSciences
Pressure BioSciences is well positioned for success in leveraging the BaroFold acquisition to upsell existing BaroFold customers with high pressure Barocycler and HUB440/880 instruments and associated consumables. Further, the deal should translate into increased services revenue, as Pressure BioSciences immediately assumes BaroFold’s biologics contract research services business, as well as opportunities to offer manufacturing-scale licenses to biopharmaceutical companies that appreciate how PreEMT can generate more efficient production of their biological products. CEO Ric Schumacher believes that these licenses alone have the potential to generate millions of dollars annually in royalty revenue.
“In this regard, we plan to continue the biologics contract research services program previously provided by BaroFold,” Schumacher said. “This entails extensive revenue-generating studies on the advantages of high-pressure processing in the manufacture of biopharmaceutical products using the patented PreEMT technology. We will also offer manufacturing-scale licenses to biopharmaceutical companies ready to take advantage of the PreEMT technology for more efficient production of their high-quality biological products. We believe such licenses have the potential to generate millions of dollars annually in royalty revenue from companies representing the global market for biopharmaceuticals, a market projected to reach $291 billion by the year 2021 (Mordor Intelligence, October 2017).”
Schumacher will be hosting a conference call on Wednesday, Dec. 20th, to review the acquisition of BaroFold in addition to the recent issuance of two patents on Pressure BioSciences’ cutting-edge Ultra Shear Technology (UST) platform and enhancements made to PBI’s core business segment of research products and services. Schumacher will also offer an outlook for the coming 2018 fiscal year.
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