BCRX

BioCryst Pharmaceuticals, Inc.

BioCryst Pharmaceuticals, Inc. is a biotechnology company that designs, optimizes and develops novel drugs that block key enzymes involved in cancer, viral infections and autoimmune diseases. BioCryst integrates the disciplines of biology, crystallography, medicinal chemistry and computer modeling to discover and develop small molecule pharmaceuticals through the process known as structure-based drug design.
Our business strategy is to maximize sustainable value by moving our product candidate portfolio through clinical development, registration and ultimately to the market. We believe this is best achieved by retaining full product rights to our product candidates within specialty markets, while relying on collaborative agreements with third parties for product candidates within larger markets or outside our areas of expertise.
One of our most advanced product candidates is peramivir, an inhibitor of influenza neuraminidase. In May 2009, we announced preliminary results from the Phase II study of intramuscular (“i.m.”) peramivir for the treatment of seasonal influenza. This Phase II study was a randomized, double-blind, placebo-controlled trial conducted in influenza seasons in the Southern Hemisphere (Australia, New Zealand and South Africa) in 2008 and the Northern Hemisphere (United States) in 2008 to 2009. While the study demonstrated a numerical trend in its primary endpoint of improvement in the median time to alleviation of symptoms (“TTAS”) in subjects with confirmed, acute, uncomplicated influenza infection versus placebo, the difference between the two study groups was not statistically significant.
We are not planning additional development of i.m. peramivir at this time; instead, our current efforts are focused on development of the i.v. formulation.

Our Business Strategy
We design, optimize and develop novel drugs that block key enzymes involved in cancer, viral infections and autoimmune diseases. We integrate the necessary disciplines of biology, crystallography, medicinal chemistry and computer modeling to effectively use structure based drug design to discover and develop small molecule pharmaceuticals.
Our business strategy is to maximize sustainable value by moving our drug candidate portfolio from discovery through clinical development, registration and ultimately to the market. We believe this is best achieved by retaining full product rights to our drug candidates within specialty markets, while relying on collaborative arrangements with third parties for drug candidates within larger markets or outside our area of expertise. Potential third party alliances could include preclinical development, clinical development, regulatory approval, marketing, sales and distribution of our drug candidates. The principal elements of our strategy are:
•Develop or License Inhibitors that are Promising Candidates for Commercialization. We test multiple compounds to identify those that are most promising for clinical development. We base our selection of promising development candidates on desirable product characteristics, such as initial indications of safety and efficacy. We believe that this focused strategy allows us to eliminate unpromising candidates from consideration sooner without incurring substantial clinical costs. In addition, our preference is to select drug candidates on the basis of their potential for relatively efficient Phase I and Phase II clinical trials that require fewer patients to initially indicate safety and efficacy. We will consider, however, more complex candidates with longer development cycles if we believe that they offer promising commercial opportunities.

•Select and License Promising Enzyme Targets for the Discovery of Small-Molecule Pharmaceuticals. We use our technical expertise and network of academic and industry contacts to evaluate and select promising enzyme targets to license for the discovery of small-molecule pharmaceuticals. We choose enzyme targets that meet as many of the following criteria as possible:

•serve important functions in disease pathways;

•have known animal or cell-based models that would be indicative of results in humans;

•address large potential markets or niche areas with significant unmet medical need; and

•have multiple potential clinical applications.
•Focus on High Value-Added Structure-Based Drug Design Technologies. We focus our drug discovery activities and expenditures on applications of structure-based drug design technologies to design and develop drug candidates. Structure-based drug design is a process by which we design a drug candidate through detailed analysis of the enzyme target, which the drug candidate must inhibit in order to stop the progression of the disease or disorder. We believe that structure-based drug design is a powerful tool for efficient development of small-molecule drug candidates that have the potential to be safe, effective and relatively inexpensive to manufacture. Our structure-based drug design technologies typically allow us to design and synthesize multiple drug candidates that inhibit the same enzyme target. We believe this strategy can lead to broad patent protection and enhance the competitive advantages of our compounds.
An important element of our business strategy is to control fixed costs and overhead through contracting and entering into license agreements with other parties. We maintain a streamlined corporate infrastructure that focuses our expertise. By contracting with other specialty organizations, we believe that we can control costs, enable our drug candidates to reach the market more quickly and reduce our business risk. Key elements of our contracting strategy may include:
•Entering Into Relationships with Academic Institutions. Many academic institutions perform extensive research on the molecular and structural biology of potential drug development targets. When we believe that an opportunity is beneficial for BioCryst we may enter into relationships with academic institutions. We will consider each opportunity and whether or not the relationship will significantly reduce the time, cost and risks involved in drug development. An example of such a collaborative relationship is the arrangement that we have with Albert Einstein College of Medicine of Yeshiva University (“AECOM”) and Industrial Research Limited (“IRL”) who are the licensors of our PNP inhibitor programs.

•Developing Drug Candidates or Licensing Them to Other Parties. We generally plan to advance drug candidates through initial and/or early-stage drug development. We prefer to retain full product rights to our drug candidates within specialty markets, while relying on collaborative arrangements with third parties or drug candidates within larger markets or outside our area of expertise. For larger disease indications or those outside our area of expertise, our strategy is to license drug candidates to pharmaceutical or biotechnology partners for collaborative development and global marketing. We believe partnerships are a good source of development payments, license fees, future event payments and royalties. They also reduce the costs and risks, and increase the effectiveness, of late-stage product development, regulatory approval, manufacturing and marketing. We are willing to license a drug candidate to a partner during any stage of the development process we determine to be beneficial to us and to the ultimate development and commercialization of that drug candidate.