Neose Technologies (NASDAQ:NTEC) may be small in terms of market cap, but the company is going after huge potential markets. It's using its proprietary enzyme-based technology to create new, long-acting therapeutic protein drug candidates.

The lead candidate for Neose is NE-180, designed to treat anemia stemming from chemotherapy or chronic renal failure. Next in development is GlycoPEG-GCSF, to restore decreased white blood cell counts following chemotherapy.

These drug candidates target markets with total sales in excess of $15 billion. At present, those spaces are dominated by Johnson  & Johnson's (NYSE:JNJ) Procrit and Amgen's (NASDAQ:AMGN) Aranesp, Epogen, Neulasta, and Neupogen. NE-180 is currently in a phase 2 clinical trial in Europe, and the FDA recently cleared Neose to commence clinical trials in the United States. One of the company's European partners, BioGeneriX AG, initiated a phase 1 trial for GlycoPEG-GCSF in late 2006 and another phase 1 trial in March 2007.

Neose has a solid balance sheet with $44.6 million in cash and investments at the end of March. The company anticipates a cash burn of $32 million-$35 million in 2007. That follows a massive restructuring in March, reducing the company's staff by 40%, to offset higher development costs this year for lead drug candidate NE-180. Company executives believe this move will give the company enough funds to reach crucial development milestones, which should bring in payments from its partners for lead drug candidates.

I'm encouraged by institutional investors' willingness to continue supporting Neose as it closes in on important clinical trial milestones. For a micro-cap biotech stock, Neose has impressive institutional ownership, exceeding 50% of all shares. It's also forged other strong partnerships with such firms as European drug giant Novo Nordisk (NYSE:NVO), with which it's developing therapeutic proteins for the bleeding disorder hemophilia. Other early-stage research efforts for Neose focus on modified versions of human growth hormone and the hepatitis C treatment interferon-alpha.

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Fool contributor Mike Havrilla, R.Ph., B.S., Pharm.D., is a Rite Aid pharmacist who lives, writes, works, and enjoys running on the streets and trails in the small Pennsylvania town of Portage. He invites your comments and feedback. Johnson and Johnson is an Income Investor selection. Mike does not have a position in any company mentioned in this article. The Fool has a disclosure policy.