The use of this novel biotin derivative incorporates a hydrophilic 40 atom PEG spacer between the peptide and biotin. This not only greatly improves the solubility of the resultant peptide, but reduces steric hindrance between the peptide and biotin, leading to better avidin binding and higher biological activity. The biotin-PEG derivative can be easily incorporated using any standard coupling method as the final step in SPPS, immediately prior to cleavage of the peptide from the resin.