After 14 years of research, Biota Holdings Ltd is hoping to market a cure for flu next year and is also working on a treatment for rhinovirus, the bug behind up to 40% of common colds.

It says it has come up with compounds that can kill rhinovirus in a test tube and hopes to experiment on animals by next year. The claim is being taken seriously by scientists because of Biota's success with a new flu treatment called Relenza.

�1 billion profits

The flu success has come with the support of British firm Glaxo Wellcome. The drugs giant paid for most of the development costs for Relenza and will pocket most of the expected �1 billion annual profits.

Biota, which has yet to show a profit and whose share price on the Australian Stock Exchange has been subject to wild fluctuations, will only take 7% of the profits.

Relenza is expected to be on sale in Australia from next year. Glaxo is expected to file for approval for the drug in 15 countries by the end of the year, including the USA.

Jamming the virus

Biota says it not only vaccinates against the flu, but cures symptoms. However, the later you take it after contracting flu, the longer it takes to shake off the symptoms.

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Other flu researchers have focused mainly on trying to bombard the flu virus with chemicals, but Biota looked at ways of jamming the part of the virus which helps it to spread.

Biota chief executive Hugh Niall said: "The scientists were able to design something that fits like a key into a lock and jams that part. The virus needs that particular part of its structure to spread within the lung. So once that's jammed, all it can do is die. It effectively kills it."

Relenza will be available as a powder which can be inhaled using a small puffer device.

Big killer

Flu kills more than three times as many people a year as AIDS. An average of 10% of people come down with the flu every year - 30% if there is a major epidemic.

But Biota could have even more success with a "cure" for the common cold which affects nearly everyone.

Biota hopes to use income from sales of Relenza to finance further research, but will need the backing of a major drugs firm as well.