UCB of the Netherlands is planning to sell off its UCB Bioproducts division, specializing in the manufacturing of peptides, in a 100 million-euro deal, according to a report in Dutch newspaper De Tijd.

UCB would not comment on the rumour, which put Belgian chemicals and pharmaceuticals firm Solvay, Dutch concern Akzo Nobel and number one European peptide company Bachem of Switzerland as potential buyers for the unit.

A report published earlier this year by consultancy firm Frost & Sullivan estimated that the global therapeutic peptides market is valued at around $1 billion dollars - with Europe contributing about $300 million of that total - and will grow by around 10.5% a year between 2003 and 2010. This means that the European market for peptides stands to double in size by 2010 to $605 million.

However, companies making peptides in Europe and the USA are seeing their margins squeezed by lower-cost producers from the Far East, so UCB may have decided the time is right to exit the sector.

In addition, since acquiring UK biotechnology firm Celltech, the Dutch company has focused more on therapeutics development, and has been exiting its activities custom synthesis and contract manufacturing. In September, UCB sold off its Celltech Manufacturing Services unit for $27.5 million.

F&S said in its report that there has been a resurgence in interest in peptides following the development of large synthetic and biological peptide libraries that, in combination with high-throughput screening processes, has enhanced the prospects of obtaining new drug candidates.

UCB is the second largest manufacturer of peptides in Europe after Bachem, and ahead of PolyPeptide Laboratories, Peptisyntha and Akzo Nobel unit Diosynth, according to the report.