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Crucell sees government interest in novel flu drug

* Expects to enter development contracts with governments

* Fast-track designation hinges on level of flu virus threat

* Technology could cut cost of making antibodies

AMSTERDAM, Aug 11 (Reuters) - Dutch biotech company Crucell NV

CRCL.AS

CRXL.O

plans to kick off clinical Phase I studies of an experimental antibody-based flu drug next year amid strong government interest, its chief executive said on Tuesday.

Crucell said in December its antibody drug had substantially outperformed Roche AG's

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market-leading Tamiflu pill in preclinical tests after it was tested against a number of flu strains, including H5N1 bird flu. [ID:nLB318636]

"There is a huge interest from governments in an antibody like that. With the threat of swine flu on our back we do expect that there are some governments we could strike a deal with," CEO Ronald Brus told reporters after Crucell posted lower-than-expected second-quarter results. [ID:nLB612488]

He said clinical trials of its product mAb CR6261 will start in 2010, but the exact date depends on regulatory authorities.

Crucell believes its product could potentially be a treatment or prevention against seasonal and pandemic influenza.

Many other biotech companies are also racing to develop flu drugs and vaccines.

Biota Holdings Ltd

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has said two or three major drug companies are interested in developing its new flu drug after it announced successful results from late-stage trials in Asia, while U.S. based Novavax

NOVA.O

has said its technology could allow it to manufacture its vaccine candidate for the new strain of H1N1 flu within 11 weeks of receiving the gene sequence. [ID:nSYU007000] [ID:nBNG252195]

Most flu vaccines currently on the market inject a dead flu virus into the body and the immune system then produces an antibody against the virus. But some people, such as the elderly or people with compromised immune systems, fail to make the antibody and the vaccine does not work.

Crucell's antibody, produced using its PER.C6 technology that uses human cells rather than chicken eggs, aims to provide the antibody to treat or prevent a wide variety of influenza viruses. Cell-based technology is thought to be more efficient than using eggs and offers greater production scale.

Despite government interest, Brus said it is hard to forecast whether Crucell could win fast-track designation from regulators, stressing it depends on how big the need is for alternative medicines and the perceived threat level of the flu virus.

The treatment is still many years away from reaching the market and may yet run into unexpected hurdles.

Still, Crucell stressed preclinical results were very promising and Brus said antibodies had a shorter development path than conventional pharmaceuticals.

Development of new anti-flu treatments is subject to heated attention due to the H1N1 flu outbreak, which was declared a pandemic on June 11 and could eventually affect 2 billion people, the World Health Organisation estimates. [ID:nLC321991]

Making antibodies was in the past extremely expensive, but Kruimer said Crucell has been able to make antibodies with its technology for a fraction of the price. The selling price, however, has not been decided. (Editing by Ben Hirschler; Editing by David Holmes)

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