Benitec licenses to US supplier Promega

Gene silencing company Benitec has taken a giant stride forward on the world stage by sealing a global licensing agreement for its technology with leading life sciences industry supplier Promega Corp.

The pact gives Promega exclusive rights to develop, sell and distribute DNA-delivered RNA interference (RNAi) products based on Benitec's propriety technology for the life its patents.

Apart from the financial benefits, which have been screened in confidentiality clauses, the deal delivers a sharp boost to the credibility of Benitec's claims to its RNAi technology.

Promega is one of the top three global distributors to life science research and commercialisation labs and its pursuit of Benitec's technology "provides a very firm basis for our assertion of being in the dominant IP position in this area of technology," said Benitec executive chairman and CEO John McKinley.

The licensing deal, which includes technology transfer from Benitec to Promega, provides initial fees and future royalties based on sales of products that are developed.

In the short term, the financial benefits will not extinguish Benitec's annual cash burn of about $AUD2.5 million, McKinley conceded.

However, the longer-range benefits promise to be significant for the company.

The Promega deal excludes the human therapeutics drug development arena where Benitec is currently engaged in discussions "with a large range of companies," McKinley said.

With cash in hand before the deal of about $500,000, Benitec was widely seen as being among those small listed Australian biotechs whose options were rapidly running out.

However McKinley rejected suggestions that the Promega breakthrough was a "save-the-company" deal.

For one thing, the RNAi field is one sector of the life sciences industry in which substantial amounts of venture capital are available, he said.

For another, unlike most small biotechs, Benitec has a revolving $2 million line of credit from long-standing high net worth investors.

In the wake of the Promega pact, Benitec plans to expand its presence in the US via synergistic partnerships with a number of companies. Its strategy for achieving its goals does not call for a massive build-up of its current 15-person headcount, McKinley said.