I don't know that there is much you can do. My sister and I are close in age and used to physically fight until quite late on in our teens I'm afraid. She is 2 1/2 years younger than me and we knew just how to push each other's buttons...and used to end up walloping each other. Once, when I was five and she was three, I bit her - but I didn't do that again, because I got a smack when my mum saw the evidence (teeth marks!)
One thing that used to stop us for a brief while was when my mum would sit us down and sorrowfully tell us how it pained her to see us going at each other like that, and how bad it made her felt. I am easily made to feel guilty, so that used to work, for a bit.
We are fine now by the way, though very different.
I bet, though, that if anyone picked on the younger one at school, the older one would be first to stick up for her. It's the Law - you are allowed to be horrible to your little sibling, but woe betide anyone else who tries it...