Friday, April 23, 2010

DotW: High(er) Hurdles

It's no secret the hurdles to drug development are getting higher. But the commercial bar has been raised, too. Those with doubts need only look at Novo Nordisk's efforts to pressure-test its Type 2 diabetes medicine Victoza, not just in head-to-head trials against its major competitor, Byetta, but also against orals like Merck DPP-IV inhibitor Januvia.

Much of Novo's future success rests on Victoza's acceptance in the marketplace. Despite regulatory delays, prescription trends show the drug is one of the few successful launches in the past year, especially when compared to the dismal adoption of either Johnson & Johnson's Simponi or Lilly/Daiichi's Effient.

But Novo is taking no chances. Its head-to-head trial with Januvia published Thursday in The Lancet proves that. In an interview with Reuters, Mads Krogsgaard Thomsen, Novo's chief scientific officer, made no bones about competing in a world where comparative effectiveness is the modus operandi: "The fact that Novo Nordisk has now done most, if not all, of the major comparator studies against different classes of oral and injectable anti-diabetic drugs really shows our commitment to showing comparative efficacy in a serious way," he said.

Comparative effectiveness is also holding sway over deal-making. We haven't yet seen deals with milestones tied to reimbursement, but we've seen plenty of deals terminated because the product's potential for commercial success was limited. The latest example is Forest Laboratories pulling the plug on its partnership with Phenomix to develop dutogliptin, the biotech's Type 2 diabetes medicine. Forest announced the move on its earnings call this week.

Analysts have never been that hot on dutogliptin, yet another DPP-IV inhibitor in a crowded space. And while Merck's Januvia has done well, with sales topping $3 billion, the same cannot be said for Onglyza, which AstraZeneca and Bristol Myers Squibb have brought late to the DPP-IV party.

Forest is new to the diabetes space and might have gotten cold feet in the wake of Onglyza's disappointing sales. Of course, the changes to FDA's diabetes guidelines, which are sending the cost of clinical development sky high, also might have chilled Forest's ardor. Forest isn't saying much beyond "business reasons" to explain the deal's demise.

Phenomix is trying to put the best spin possible on the news. The same day Forest axed the program, the biotech reported positive data from a Phase III six-month study comparing dutogliptin to placebo. Phenomix' drug appears to have similar efficacy but better safety and tolerability than other DPP-IVs, noted CEO Laura Shawver in an interview with "The Pink Sheet" DAILY. The company has four Phase III programs underway and plans to run a fifth cardiovascular study to meet FDA's new diabetes guidelines. The pressure is on for Phenomix to find a new partner and more cash.

It's yet another way biotech is like a singles bar: you're one of many in a crowded field, you need a new partner, and the drinks are more expensive than you realized. Sometimes it's better to go home, put on your flannel PJs, and curl up with another edition of...

Novartis/Oriel: With the acquisition this week of privately-held Oriel Therapeutics for an undisclosed sum, Novartis' Sandoz unit gains a portfolio of drug candidates and related technologies for asthma and chronic obstructive pulmonary disease, a key therapeutic area for the generic drug maker. With GlaxoSmithKline's Advair, AstraZeneca's Symbicort, and Pfizer/Boehringer Ingelheim's Spiriva losing patent protection by 2016, Novartis's Sandoz hopes to capture a big chunk of the inhalable respiratory generic market. It can be quite lucrative because the complex delivery systems are a barrier to entry that potentially limits competition. Sandoz has already put $60 million toward the development of a new facility in Rudolstadt, Germany with manufacturing capacity for dry-powder inhalers and metered-dose inhalers. The acquisition of Oriel, meanwhile, provides Sandoz with three development projects targeting leading medicines and a novel delivery technology, FreePath. Sandoz's work in generic respiratory meds complements Novartis's innovator products; the pharma has a long-acting beta 2 antagonist, indacaterol, in development for COPD in the US and marketed in Europe as the Onbrez Breezhaler. -- Jessica Merrill

Clovis/Ventana: Less than a year after securing $145 million in start-up financing from a cadre of blue-chip investors in the largest A round ever for a biotech, in-licenser Clovis Oncology has mapped out a development and approval track for its first drug, which under a deal announced this week, will include a companion diagnostic to be developed and sold by Ventana Medical Systems. In November, Clovis acquired rights to Clavis Pharma’s lipid-conjugated formulation of gemcitabine based on information showing the drug, renamed CO-101, could outperform gemcitabine in pancreatic cancer patients with low levels of a specific transporter protein, hENT1. (This population is estimated to be 50% of the total number with the disease.) Clovis also believes CO-101 will work as well as gemcitabine, the current standard of care for pancreatic cancer, in patients with high levels of hENT1. Its 250-patient trial will capture data on the performance of CO-101 head-to-head against gemcitabine in both the hENT1-low and -high populations, and could be sufficient for registration filings in the US and Europe, said CEO Pat Mahaffy. When ready, the Ventana diagnostic will sort patients into low- or high-level populations using tissue biopsies collected at the start of the study. The program reflects Clovis’s intention to develop drugs with a clear path to approval, incorporating a companion diagnostic. “We are strong believers that technology and the regulatory environment are driving toward exactly this approach,” said Mahaffy. -- Mark Ratner

Novartis/Array: Boulder, CO-based Array BioPharma has an array of options now that it has partnered its small molecule MEK inhibitor program to Novartis in a deal worth $45 million in upfront and near-term milestone payments, and downstream milestones totalling another $422 million. It's anecdotal evidence of a factoid we discussed at Pharmaceutical Strategic Outlook: early-stage deal values, especially for Phase I products, are on the rise. Analysts and investors found a lot to like in the deal, Array's second high-value collaboration in four months, and sent the firm's stock price soaring more than 30% in after-hours trading following the announcement. Novartis gains exclusive rights to ARRY-162, currently in Phase I trials for biliary tract cancer, plus a back-up compound ARRY-300 and earlier compounds. Array has the option to co-develop '162 in one or more indications and co-promote it in the US. (That seems to be another de facto condition of oncology deal making these days.) One reason the product might have attracted such a healthy sum is that its safety profile is largely derisked from its Phase II trials in rheumatoid arthritis. There were no safety problems, but the trials were a big disappointment, with the drug doing no better than placebo at thwarting the disease. -- EFL

Boehringer Ingelheim/Biota: BI terminated its 2006 agreement with the Australian pharma Biota Holdings for nucleoside analogs to treat hepatitis C, largely because it could not identify a suitable pre-clinical candidate to advance forward, the companies announced April 20. Rights now revert to Biota, which develops anti-infectives and originated the flu drug Relenza (zanamivir). Biota could have earned up to $102 million from Boehringer if a compound reached the market. At least it has a steady flow of Relenza cash. It reported $AU32.6 million in royalties from GlaxoSmithKline for Relenza for the quarter ended Dec. 31, 2009, with expected royalties of AU$56.7 million for the first half of 2010. Under the 2006 deal, Biota licensed to Boehringer global rights to develop and sell its tricyclic group of nucleoside analog drug candidates for HCV infection and possibly additional indications. In turn, Boehringer agreed to an up-front technology payment, preclinical, clinical, regulatory, and sales milestones, plus R&D funding totaling $102 million. The companies worked jointly on the HCV research program from the time they signed the agreement until last November, when Boehringer-Ingelheim took over R&D activities. -- Carlene Olsen

Image courtesy of flickrer Robert Voors via a creative commons license.

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