• Tier 1: market capitalization in excess of $10 billion
• Tier 2: market capitalization greater than $2 billion but less than $10 billion
• Tier 3: market capitalization of at least $1 billion but less than $2 billion

At that time, the 30 companies in these three groups had a collective market capitalization of approximately $240 billion. Assuming that investors reinvested the entire $47 billion in cash they received from the Roche/Genentech transaction into these groups, it would have represented nearly 20% of the total value.  While some of the money may have been reinvested in Roche, such an imbalance between supply and demand could have resulted in relative outperformance from members of the three groups.

Following today’s news that Sanofi-aventis (SNY) is acquiring Genzyme Corporation (GENZ) for approximately $20 billion in cash [plus a contingent value right], we reviewed the performance of our three tiers to determine which companies, if any, benefited the most from the reinvestment of $47 billion following the Roche/Genentech transaction.

From the date that the Roche/Genentech transition was announced [March 12, 2009] through February 15, 20111, the NASDAQ Composite (COMP) was up approximately +97%.  In contrast, the NBI only increased +50% during the period.  Recall that the NBI is calculated under a modified capitalization-weighted methodology, taking into account the total market value of the companies it tracks and not just their share prices.  Accordingly, companies with the largest market capitalization have the highest weighting in the index – making the NBI a good proxy for the performance of larger capitalization biotechnology companies.

Contrary to expectations, the largest biotechnology companies did not appear to benefit from a reallocation of funds from the Roche/Genentech transaction and posted the worst overall performance during the period.  In fact, all six members of the Tier 1 group underperformed the NBI, which includes Genzyme [see Table 1].  The companies in Tier 1 should have been the closest to Genentech with regard to their risk/return profile.

Table 1: Tier 1 Group

With market capitalizations greater than $2 billion but less than $10 billion around the time that the Roche/Genentech transaction was announced, Tier 2 represented the best performing group.  While Tier 2 contained both winners and losers, more than half of the Tier 2 companies outperformed the NBI, including four with triple-digit gains during the period [see Table 2].

Table 2: Tier 2 Group

* Acquired by Astellas Pharma in May 2010, price as of 3/31/2009 and the acquisition price, respectively

Tier 3 was the second best performing group.  Half of the Tier 3 companies outperformed the NBI, including four with triple-digit gains during the period [see Table 3].

Table 3: Tier 3 Group

* Acquired by Gilead in March 2009, price as of 3/31/2009 and the acquisition price, respectively

** Acquired by Dainippon Sumitomo Pharma in September 2009, price as of 3/31/2009 and the acquisition price, respectively

In conclusion, the reallocation of funds following a significant merger & acquisition [M&A] transaction for cash doesn’t appear to benefit larger biotechnology companies with similar risk/reward profiles in terms of relative stock performance [Tier 1].  While a comprehensive analysis of the data is beyond the scope of this article, this could result from the reallocation of capital into the acquiring company, sufficient liquidity from larger biotechnology companies to withstand the increased demand, and/or other factors.   However, using history as a guide, those companies with a market capitalization between $2 and $10 billion appear most likely to benefit from reinvestment following the recent Sanofi/Genzyme transaction.

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Adding to an already hectic schedule of one-on-one meetings during the week, the success of JPMHC has spawned numerous satellite events, such as Biotech Showcase, OneMedForum, New Paradigms Conference, and China Forum.  The latter event provides further evidence that China is emerging as an important component of the international biotechnology landscape, as 16 China-based life science companies also presented during an inaugural China Track at JPMHC.

In between offsite meetings, we roamed the familiar halls of the Westin St. Francis Hotel to assess the mood among participants and also monitored online media commentaries throughout the event.  In general, the plane flights and networking receptions were crowded as usual, industry observers “Tweeted” a sense of optimism, and attendees appeared more upbeat than in 2010.  However, we once again sought to construct a less subjective assessment by analyzing year-over-year statistics from the conference.

Accordingly, we extensively reviewed press releases issued by biotechnology companies during JPMHC from 2009 to 2011, with a particular focus on identifying the number of merger & acquisitions [M&A], licensing & partnering transactions, and financing deals announced each year during the four-day event.

Merger and Acquisitions

Back in 2009, several large M&A transactions were announced during JPMHC.  That year, four M&A transactions with an aggregate value of $702 million were disclosed during the first two days of the event.  The largest deal went to Cephalon, Inc. (CEPH), which announced a $100 million option agreement providing the company with an opportunity to purchase all outstanding capital stock of Ception Therapeutics, Inc., a privately held biopharmaceutical company, for an additional $250 million.

Despite ongoing discussions between Sanofi-aventis (SNY) and Genzyme Corporation (GENZ), only one significant M&A transaction was announced during JPMHC in 2011, marking the second year in a row with a paucity of deals.  Finland-based Biotie Therapies Corp., a drug developer focused on central nervous system [CNS] and inflammatory diseases, announced that it is acquiring Synosia Therapeutics Holding AG in an all-share deal that values the private Swiss company at approximately $125 million.  Synosia Therapeutics Holding AG is a biopharmaceutical company focused on developing and commercializing a portfolio of CNS product candidates licensed from Roche Holding AG (RHHBY.PK), Novartis AG (NVS), and Syngenta AG (SYT).

Table 1. Select M&A Transactions Announced During JPMHC from 2009-2011 ($ in millions)

Licensing and Partnering

In 2009, ten strategic licensing and/or partnering transactions with an aggregate value exceeding $2.4 billion were announced during JPMHC. The transactions included a $1.1 billion deal between ZymoGenetics, Inc. and Bristol-Myers Squibb Company (BMY), a $500 million deal between Peptimmune, Inc. and Novartis AG (NVS), a $396 million deal between Micromet, Inc. (MITI) and Bayer AG (BAYZF.PK), and a $200 million deal between FORMA Therapeutics the Novartis Option Fund to develop inhibitors for an undisclosed protein-protein interaction target in the field of oncology, among others. Interesting to note, Bristol-Myers Squibb later acquired ZymoGenetics Inc. for $885 million in cash during September 2010.

In 2010, there were only six transactions totaling $314 million announced at JPMHC, driven primarily by a $290 million agreement between privately held KaloBios Pharmaceuticals, and Sanofi Pasteur, the vaccines division of the Sanofi-aventis, for the development and commercialization of KB001, an investigational new biologic for the treatment or prevention of Pseudomonas aeruginosa [Pa] infections.

In 2011, three major licensing and/or partnering transactions totaling more than $3 billion were announced during JPMHC, although three-quarters of the total value came from a single agreement:

• Eli Lilly and Company (LLY) and Boehringer Ingelheim announced a $2.4 billion global agreement to jointly develop and commercialize a pipeline of oral diabetes agents and basal insulin analogues.  The alliance also includes the option to co-develop and co-commercialize Eli Lilly’s anti-TGF-beta monoclonal antibody.
• Privately held Epizyme, Inc. announced a strategic alliance with GlaxoSmithKline plc (GSK) that could be worth over $650 million.  Epizyme is involved in the discovery and development of small molecule histone methyltransferase inhibitors, a new class of targeted therapeutics for the treatment of genetically-defined cancer patients, based on breakthroughs in the field of epigenetics.  Epigenetics refers to the regulation of genes with mechanisms other than changes to the underlying DNA sequence and such processes are widely believed to play a central role in the development and progression of almost all cancers.
• Takeda Pharmaceutical Company Limited and Zinfandel Pharmaceuticals, Inc. announced an exclusive, worldwide licensing agreement regarding Zinfandel’s TOMM40 assay as a biomarker for the risk of Alzheimer’s disease, including potential use of the assay in combination with pioglitazone in high-risk older adults with normal cognition.  Pioglitazone is the active ingredient currently marketed in Takeda’s ACTOS® (pioglitazone HCl). Under the terms of agreement, Zinfandel will receive an upfront payment of $9 million and subsequent payments of up to $78 million for development milestones from Takeda.

Table 2. Select Licensing and Partnering Deals Announced During JPMHC from 2009-2011 ($ in millions)

Financing

While the quantity of public and private financing transactions announced during JPMHC has remained essentially flat from 2009-2011, the aggregate dollar value increased more than 60% in 2011.  Note that we excluded the $500 million convertible senior note transaction announced by Dendreon Corporation (DNDN), as it occurred after the market closed last Thursday [the last day of JPMHC].

Table 3. Select Financing Transactions Announced During JPMHC from 2009-2011 ($ in millions)

Outlook

At the start of 2009, we provided a positive outlook for the biotechnology industry.  Most of the drivers supporting our favorable view remain intact for 2011, such as the record number of products in clinical trials and annual industry R&D investment, improving access to capital, brisk pace of industry consolidation and licensing transactions, and attractive valuations among many small- and mid-capitalization companies, which we believe should continue to outperform their larger industry peers in 2011.

The +60% year-over-year increase in the aggregate value of financing transactions announced during JPMHC in 2011 supports our improving access to capital thesis, offset in part by the fact that both the quantity and value of M&A and licensing/partnering transactions during the period were below 2009 levels [excluding a single agreement for $2.4 billion in 2011].   Using 2010 as a guide, the mixed bag of activity emanating from JPMHC is simply the pause that refreshes and activity should accelerate throughout the year.

Looking beyond JPMHC, the key risk to our positive outlook in 2011 relates to the number of U.S. Food and Drug Administration [FDA] drug approvals, which declined in 2010 and is more than 50% below the high of 56 new approvals in 1996 despite the fact that legislation passed in 2008 gave the FDA more money and resources.  There is no discounting the negative impact of clinical and regulatory setbacks on the psyche of biotechnology investors, as evidenced by the greater than 10% decline in the NASDAQ Biotech Index in late February 2009 following a spate of high profile disappointments.

The tale seems fitting to illustrate the evolution of drugs that target the phosphatidylinositol 3-kinase [PI3K] pathway [see Table 2 for a listing of compounds in clinical development].  Despite ample evidence that pan-PI3K inhibitors and dual PI3K/mTOR inhibitors might offer a therapeutic advantage, tailors continue to weave new compounds targeting individual components of the pathway with presumably superior properties.  But does the “mTOR” really have new clothes?

Pathway Layout

The PI3K pathway regulates cell growth, survival, proliferation, migration, and the process of angiogenesis and is frequently deregulated in cancer, which makes it one of the most attractive targets for anticancer therapy.  Big pharma’s interest in the target is evidenced in part by Sanofi-aventis’ (SNY) licensing of two early-stage PI3K inhibitor programs [XL147 and XL765] from Exelixis, Inc. (EXEL) in May 2009 that could result in development, regulatory and commercial milestone payments to the company that total over $1 billion in the aggregate [including $140 million in cash upfront], as well as royalties on sales of any products commercialized under the license.

In general, the pathway comprises the following three components starting near the cell membrane and continuing towards the nuclear machinery at the heart of cellular processes:

1.     PI3K

-       Held in check by the phosphatase PTEN, PI3K can be activated by upstream tyrosine kinase receptors

-       Four class I isoforms of PI3K [α, β, γ, δ, or alpha, beta, gamma, delta]

2.     Akt

-       Gets recruited to the proper location in the cell needed for activity [cell membrane] and is changed into the required active conformational state by phosphorylation of T308 by the action of PI3K

3.     mTOR

-       Promotes increased protein synthesis in part driven by activated Akt

-       Forms complexes called mTORC1 and mTORC2, of which mTORC2 directly increases Akt by phosphorylation on S473

Dysfunction of PI3K, Akt, and/or mTOR is associated with cancer and while cellular signaling becomes more complex on almost a daily basis, much has been discovered about the best way to effectively block the pathway in cancer cells.  Accordingly, the purpose of this article is to highlight some of the latest advances in our understanding of the PI3K pathway along with the leading companies working in this market segment.

Good, Better, and Best

Pfizer, Inc.’s (PFE) Torisel® [temsirolimus] and Novartis AG’s (NVS) Afinitor® [everolimus], both for the treatment of renal cell carcinoma, were among the first PI3K pathway inhibitors [via inhibition of mTORC1] to reach the market – Torisel in May 2007 and Afinitor in March 2009.  While inhibition of mTORC1 through rapamycin or the rapalogs [“Good”] demonstrated sufficient clinical activity for U.S. Food and Drug Administration [FDA] approval, there is clear evidence that blocking only mTORC1 activity paradoxically leads to activation of the PI3K pathway through redundant or alternative signaling mechanisms.  For example, mTORC2 can activate Akt by phosphorylation on the S473 position.  This led to the design of mTOR complex catalytic site inhibitors [“Better”] that block the activity of both mTORC1 and mTORC2.  While effective in shutting down mTOR activity, this approach still provides for partial activation of Akt on T308 by PI3K.  Therefore, simultaneous inhibition of both PI3K and mTOR kinase activity with a dual PI3K/mTOR inhibitor [“Best”] would be expected to more effectively shut down PI3K-Akt-mTOR signaling and such an agent could remain effective in situations where the activity of mTOR inhibition has been circumvented.

Isoform Selectivity: Is Less Really More?

In addition to the benefits of dual PI3K/mTOR inhibition as described in the prior section, there is also compelling biological rationale for inhibiting all four of the class one PI3K isoforms [α, β, γ, δ, or alpha, beta, gamma, delta] rather than inhibiting only a subset.  The most compelling support for pan-PI3K inhibition is the recent disclosure that the activity of any class 1A PI3K isoform [alpha, beta, or delta] can sustain cell proliferation and survival [ref 1].  Additionally, both in vitro and in vivo studies indicated that for PTEN-negative tumors inhibition of the beta isoform is needed [ref 2].  Moreover, evolving analyses of cancer tissues provides additional rationale for inhibiting the various isoforms as for example the recent finding that the gamma isoform has tumor-specific overexpression in pancreatic cancer [ref 3].

The role of PI3K in a wide range of normal biologic processes raised potential toxicity concerns about pan-PI3K inhibitors and dual PI3K/mTOR inhibitors, which led to the development of isoform-selective inhibitors.  However, clinical data presented at the 2010 American Society of Clinical Oncology [ASCO] annual meeting demonstrated relatively consistent toxicity profiles among pan-PI3K, dual PI3K/mTOR, and isoform-selective PI3K inhibitors, with no discernable safety advantage among the class [see Table 1 below].  The most common side effects reported with these inhibitors included diarrhea, nausea, vomiting, and fatigue [ref 8].  Liver damage, as evidenced by elevated aspartate aminotransferase [AST] and alanine aminotransferase [ALT] levels, were reported only with orally administered pan-PI3K, dual PI3K/mTOR, and PI3K delta isoform-specific inhibitors and were dose limiting in some cases.  Interestingly, insulin resistance [hyperinsulinaemia or hyperglycaemia] was originally predicted to be one of the most likely toxicities resulting from on-target effects of PI3K inhibitors, but has not been widely observed in clinical trials to date.

Table 1. Adverse Event Profiles as Reported at 2010 ASCO Annual Meeting

+ = Adverse event listed among the top five most frequent Grade 1 or 2 in the trial

++ = Dose limiting toxicities

* = For GDC-0941, results are from GDC4254g study; for PX-866, AST/ALT toxicity is only in the continuous daily dosing arm

n/r = Grade 1 and 2 data has not been reported

Helping explain the lack of variation between pan-PI3K, dual PI3K/mTOR, and isoform-selective PI3K inhibitor toxicity profiles is the translation of data from in vitro potency to in vivo settings.  For example, while Calistoga Pharmaceuticals’ (private) CAL-101 product candidate demonstrates relative selectivity for the PI3K delta isoform using traditional two-dimensional [2D] monolayers of cancer cells, the significant blood levels seen clinically suggest that all isoforms may be inhibited at least part of the time.  In addition, in a PTEN-null PC3 xenograft model Roche Holding AG’s (RHHBY.PK) PI3K inhibitor GDC-0941 at 75mg/kg daily [ref 4] showed similar inhibition of about 80% of tumor growth as Semafore Pharmaceuticals’ (private) dual PI3K/mTOR inhibitor SF1126 at 20mg/kg three times per week [ref 5] even though SF1126 is reported to be at least 10-times less potent on all PI3K isoforms.  Two recent publications help further support the dramatic differences between 2D and 3D cell cultures and perhaps shed some light on how potency translates, or fails to translate, into in vivo models [refs 6,7].

Future Directions

Prodrugs

One of the most widely studied PI3K inhibitors, LY294002 possesses a unique mechanism of drug action through dual inhibition of all Class 1 PI3K isoforms and mTOR, inhibition of additional cancer kinases such as PIM1, DNA-PK, and PLK1, and the molecule’s ability to induce apoptosis and oxidative stress through other mechanisms.  However, the strong hydrophobicity of LY294002 drastically limits its use in natural form.  In addition, there is the aforementioned concern for toxicity through the non-specific, indiscriminate inhibition of the PI3K pathway in normal cells.  Therefore, Semafore Pharmaceuticals sought to improve the use of LY294002 by enhancing its solubility, selectivity and in vivo delivery by preparing a functional prodrug that selectively accumulates in tumor areas to maximize efficacy and minimize toxicity.  The resulting new chemical entity, SF1126, has been tested in more than 50 patients in Phase 1 trials.

Disease Settings and Biomarkers

In general, the standard paradigm for early drug development is to test compounds in a broad range of cancers to identify those in which the compounds work, which then forms the basis for future clinical development and regulatory strategy.  Such has been the case with development of PI3K inhibitors.

Across the nine mixed solid tumor Phase 1 studies reported at ASCO 2010, 114 out of 469 patients [24%] showed stable disease, prolonged in some cases, as the best response [ref 8].  Only 5 partial responses out of 469 patients [1%] of unknown duration were reported from the group in total.  Of these 3 were in breast cancer patients, one was in non-small cell lung carcinoma [NSCLC], and one was in a patient with lung cancer/Cowden disease.   On this basis, there is no clear direction for development of PI3K inhibitors in the solid tumor setting.

In contrast, significant responses in hematological cancers have been reported with PI3K inhibitors.  For example, Calistoga Pharmaceuticals’ delta selective PI3K inhibitor CAL-101 demonstrated overall response rates of 57%, 67%, and 30% in indolent non-Hodgkin’s lymphoma [NHL], mantle cell lymphoma [MCL], and chronic lymphocytic leukemia [CLL], respectively.  However, in acute myeloid leukemia [AML], multiple myeloma [MM] and diffuse large B-cell lymphoma [DLBCL] there were no responses and no stable disease.  Accordingly, several pan-PI3K inhibitors and dual PI3K-mTOR inhibitors are advancing clinical development in the responsive B-cell malignancies both alone and in combination with potentially synergistic agents.  Updated clinical data from various PI3K inhibitor programs is expected at the upcoming American Society of Hematology [ASH] annual meeting held December 4-7, 2010, in Orlando, FL.

Instead of testing compounds in mixed patient populations, another strategy is to use the most compelling preclinical data to guide genotype-directed trials.   For example, preclinical work suggests that cancers with PIK3CA mutations might be most sensitive [ref 9] and cancers with KRAS mutations might be difficult to treat with single agent PI3K inhibitors [refs 10,11].

Dual Pathway Inhibition – Better than Best?

Beyond the aforementioned PI3K pathway redundancies highlighting the potential benefits of dual PI3K/mTOR inhibition, recent data demonstrate crosstalk between the mitogen-activated protein kinase [MAPK] pathway and PI3K pathway.  This can serve as a back-up pathway to survival, particularly in the case of mutations in the MAPK pathway such as KRAS mutations [ref 10].

This discovery has led to the unusual step of evaluating clinical combinations of unapproved PI3K and MAPK inhibitors.  For example, Novartis’ PI3K inhibitor BKM120 is being combined with GlaxoSmithKline plc’s (GSK) MEK inhibitor GSK1120212 in a Phase 1 study focused on tumors with RAS/RAF mutations and triple negative breast cancer [ref 12].  In addition, Merck & Company, Inc.’s (MRK) allosteric Akt inhibitor MK-2206 is being combined with AstraZeneca plc’s (AZN) MEK inhibitor AZD6244 [ref 13] and Roche Holding AG has a trial combining their PI3K inhibitor GDC-0941 and MEK inhibitor GDC-09773 [ref 14].

Developing one investigational drug is challenging enough, but developing two investigational compounds simultaneously can be daunting.   Complexities can arise from trying to match different administration schedules and differing pharmacokinetics [PK], distribution, and metabolism profiles between the combined agents.  A single molecule that simultaneously inhibits both PI3K and MAPK would therefore be preferable and the following three companies are currently pursuing this single-molecule, dual pathway inhibition strategy with their respective preclinical product candidates:

1.     AEterna Zentaris, Inc. (AEZS): preclinical molecule [AEZ132] that inhibits PI3K and Erk

2.     Progenics Pharmaceuticals, Inc. (PGNX): preclinical molecule [PGNX-01/02] that inhibits mTOR/PI3K and MNK [downstream of Erk]

3.     Semafore Pharmaceuticals: preclinical molecule [SF2626] that inhibits PI3K and MEK

Conclusion

Our understanding of the PI3K pathway has advanced significantly since the FDA approved the first mTORC1 inhibitors for the treatment of renal cell carcinoma in 2007/2009.  Promising results have been demonstrated in the area of hematological malignancies with next-generation PI3K inhibitors and new insights into the pathway biology has led to the development of new molecules and combination approaches that will allow us to realize the ultimate potential of this pathway as a therapeutic target for a variety of diseases.

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Table 2: Select PI3K Pathway Inhibitors in Clinical Development

REFERENCES:

1. Lazaros C. Foukasa, Inma M. Berenjenoa, Alexander Grayb, Asim Khwajac, and Bart Vanhaesebroeck  “Activity of any class IA PI3K isoform can sustain cell proliferation and survival”, Proceedings of the National Academy of Sciences, June 22, 2010; vol. 107, No. 25, 111381-11386.
2. Kyle A. Edgar, Jeffrey J. Wallin, Megan Berry, Leslie B. Lee, Wei Wei Prior, Deepak Sampath, Lori S. Friedman, and Marcia Belvin, “Isoform-Specific Phosphoinositide 3-Kinase Inhibitors Exert Distinct Effects in Solid Tumors”, Cancer Research, February 1, 2010; vol.70, No. 3, 1164-1171.
3. Charlotte E. Edling, Federico Selvaggi, Richard Buus, Tania Maffucci, Pierluigi Di Sebastiano, Helmut Friess, Paolo Innocenti, Hemant M. Kocher, and Marco Falasca, “Key Role of Phosphoinositide 3-Kinase Class IB in Pancreatic Cancer”, Clinical Cancer Research, published OnlineFirst on September 28, 2010 as 10.1158/1078-0432.CCR-10-1210.
4. See Figure 5 of Reference 2.
5. Joseph R. Garlich, Pradip De, Nandini Dey, Jing Dong Su, Xiaodong Peng, Antoinette Miller, Ravoori Murali, Yiling Lu, Gordon B. Mills, Vikas Kundra, H-K. Shu, Qiong Peng, and Donald L. Durden, “A Vascular Targeted Pan Phosphoinositide 3-Kinase Inhibitor Prodrug, SF1126, with Antitumor and Antiangiogenic Activity”, Cancer Research, January 1, 2008; vol. 68, No. 1, 206-215.
6. Ville Harma, Johannes Virtanen, Rami Makela, Antti Happonen, John-Patrick Mpindi, Matias Knuuttila, Pekka Kohonen, Jyrki Lotjonen, Olli Kallioniemi, Matthaias Nees, “A Comprehensive Panel of Three-Dimensional Models for Studies of Prostate Cancer Growth, Invasion and Drug Responses”, PLoS ONE May 2010, vol. 5, e10431
7. Maria Laura Polo, Maria Victoria Arnoni, Marina Riggio, Victoria Wargon, Claudia Lanari, Virginia Novaro, “Responsiveness to PI3K and MEK Inhibitors in Breast Cancer.  Use of a 3D Culture System to study Pathways Related to Hormone Independence in Mice”, PLoS ONE May 2010, vol. 5, e10786.
8. Joseph Garlich, Candace Shelton, Wenqing Qi, Xiaobing Liu, Laurence Cooke, Daruka Mahadevan,”Update on the Novel Prodrug Dual nTOR-PI3K Inhibitor SF1126″, Poster presented at: Next-Gen Kinase Inhibitors Oncology and Beyond, June 21-23, Cambridge, MA.  Poster available at: http://www.semaforepharma.com/publications.html.
9. Shingo Dan, Mutsumi Okamura, Mariko Seki, Kanami Yamazaki, Hironobu Sugita, Michiyo Okui, Yumiko Mukai, Hiroyuki Nishimura, Reimi Asaka, Kimie Nomura, Yuichi Ishikawa, and Takao Yamon, “Correlating Phosphatidylinositol 3-Kinase Inhibitor Efficacy with Signaling Pathway Status: In silico and Biological Evlauations”, Cancer Research, June 15, 2010; vol. 70, No. 12, 4982-4993.
10. Martin L. Sosa, Stefanie Fischera, Roland Ullrich, Martin Peifer, Johannes M. Heuckmann, Mirjam Koker, Stefanie Heynck, Isabel Stuckrath, Jonathan Weiss, Florian Fischer, Kathrin Michel, Aviva Goel, Lucia Regales, Katerina A. Politi, Samanthi Perera, Matthaus Getlik, Lukas C. Heukamp, Sascha Ansen, Thomas Zander, Rameen Beroukhim, Hamid Kashkar, Kevan M. Shokat, William R. Sellers, Daniel Rauh, Christine Orr, Klaus P. Hoeflich, Lori Friedman, Kwok-Kin Wong, William Pao, and Roman K. Thomasa, “Identifying genotype-dependent efficacy of single and combined PI3K- and MAPK-pathway inhibition in cancer” Proceedings of the National Academy of Sciences, October 27,2009; Vol.106, No. 43, 18351-18356.
11. Nathan T. Ihle, Robert Lemos, Jr., Peter Wipf, Adly Yacoub, Clint Mitchell, Doris Siwak, Gordon B. Mills, Paul Dent, D. Lynn Kirkpatrick, and Garth Powis, “Mutations in the Phosphatidylinositol-3-Kinase Pathway Predict for Antitumor Activity of the Inhibitor PX-866 whereas Oncogenic Ras is a Dominant Predictor for Resistance, Cancer Research, January 1, 2009; Vol. 69, No. 1, 142-150.
12. Source:  www.clinicaltrials .gov website. Clinical Trials.gov identifier number NCT01155453, started April 2010.
13. Source:  www.clinicaltrials .gov website. Clinical Trials.gov identifier number NCT01021748, started November 2009.
14. Source:  www.clinicaltrials .gov website. Clinical Trials.gov identifier number NCT00996892, started November 2009.

According to the American Cancer Society, pancreatic cancer is a devastating disease with the worst mortality rate and an overall 5-year survival rate lower than 5%.  Although accounting for only 3% of all cancers, this disease is the fourth leading cause of death and represents 6% of all cancer related deaths in the United States.

The disease remains one of the most difficult to treat due to late initial diagnosis and extreme resistance to treatment.  For example, about 50% of patients have locally advanced disease at the time of diagnosis, indicating that the cancer has grown beyond the confines of the pancreas to invade surrounding vital structures, and in 40% of patients the tumor has spread to distant sites, such as the liver and lungs [metastatic stage].  Case in point: Patrick Swayze was diagnosed with stage IV pancreatic cancer that had already spread to the liver in March 2008 and lost his battle with the disease in September 2009 at the age of 57.

The majority of pancreatic tumors [95%] are adenocarcinomas that mainly develop from exocrine cells in the tissues of the pancreas.  They are characterized by an aggressive behavior with a fast progression rate that makes them highly metastatic.  Neuroendocrine tumors [NET] of the pancreas [islet cell tumors] are much less common [1-2%] than exocrine pancreatic tumors and are considered less deadly.  For example, Steve Jobs, co-founder and chief executive of Apple Inc. (AAPL), was diagnosed with this rare, slow-growing pancreatic tumor in 2004.

In terms of treatment, surgical removal of the tumor represents the best option for pancreatic cancer patients without invasion into surrounding organs or distant metastasis.  Unfortunately, only 15–20% of all patients are candidates for potentially curative surgery.  Depending on the tumor localization, pancreaticoduodenectomy, distal or total pancreatectomy can be performed.  However, even with an optimal curative surgery, metastases often occur.  Median survival time without evidence of recurrent disease is 21.2 months after resection.

For locally advanced or metastatic disease, treatment is still palliative rather than curative, and chemotherapy remains the only option.  Since its approval in 1997, Eli Lilly’s (LLY) Gemzar® [gemcitabine] is the current standard first-line treatment in the U.S.  It has been shown to improve the median time to disease progression and overall survival [OS].

Just like lupus, sepsis, and several others, pancreatic cancer has been referenced as one of those challenging diseases where good drugs [and companies…] go to die.  Since 2005, nine late-stage clinical trials have been performed to improve the efficacy of gemcitabine with little success in terms of improving survival outcomes [see Table 1].  Such failures resulted in at least two companies filing for bankruptcy [both Aphton Corp and Therion Biologics in 2006].  In fact, the only combination approved by the U.S. Food and Drug Administration [FDA] is gemcitabine plus Astellas Pharma’s Tarceva® [erlotinib], which increased the median OS from 6.0 to 6.4 months.

Table 1. Prominent Late-stage Pancreatic Product Failures

Despite past failures, drug developers continue to explore new options for treating pancreatic cancer and more than a dozen new molecular entities are currently being evaluated in clinical trials [see Table 2].  Several programs have recently demonstrated impressive results in Phase 2 studies and are now enrolling patients in pivotal trials.  While a comprehensive review of investigational pancreatic cancer therapies is beyond the scope of this article, we briefly review some of the more promising pancreatic treatments currently in clinical development:

Celgene Corporation (CELG)

Historically known more for its franchise in treating blood cancers, Celgene moved into the realm of solid tumors through its recent acquisition of Abraxis BioScience, Inc.  As a result, Celgene is now developing Abraxane® [paclitaxel protein-bound particles for injectable suspension] for the treatment of pancreatic cancer.  Updated overall survival findings from a phase I/II study of Abraxane given in combination with gemcitabine demonstrated increased survival of the first-line treatment of patients with advanced pancreatic cancer.  In 44 patients treated at the recommended dose of 125 mg/m² Abraxane plus gemcitabine [1000 mg/m²], the median OS time was 12.2 months, an impressive doubling of survival compared to historical control of gemcitabine administered alone.  The findings were discussed at the 101st Annual Meeting of the American Association for Cancer Research [AACR] in 2010. The combination of Abraxane and gemcitabine is now the treatment arm of a randomized Phase 3 clinical trial that is currently enrolling patients [ClinicalTrials.gov identifier NCT00844649].

Novartis AG (NVS)

In June 2010 at the12th World Congress on Gastrointestinal Cancer, Novartis reported that its RADIANT-3 Phase 3 study of Afinitor® (everolimus), plus best supportive care met its primary endpoint, showing that the drug more than doubled median progression-free survival [PFS], or time without tumor growth, from 4.6 to 11.0 months when compared with placebo in patients with advanced pancreatic NET.  More recently, Novartis presented data from a second Phase 3 study called RADIANT-2 at the 35th European Society for Medical Oncology [ESMO] Congress.  The study, which evaluated Afinitor® in combination with Sandostatin® LAR Depot (octreotide acetate for injectable suspension), demonstrated that everolimus plus octreotide LAR provided a clinically meaningful extension in the median time without tumor growth from 11.3 to 16.4 months when compared with placebo plus octreotide LAR.  However, the study did not meet its primary endpoint of PFS based on central radiologic review of the data (p=0.026 versus p=0.024 predefined).  According to the company, results from the two RADIANT trials will form the basis for regulatory filings later in 2010.

Amgen, Inc. (AMGN)

Amgen is developing AMG 479, an investigational fully human monoclonal antibody that targets type 1 insulin-like growth factor receptor [IGF-1R], which plays an important role in the regulation of cell growth and survival.  At the 2010 American Society of Clinical Oncology [ASCO] Annual Meeting, Amgen announced results from a Phase 2 study demonstrating that the addition of AMG 479 to gemcitabine resulted in an overall survival rate at six months of 57% versus 50% with gemcitabine alone and 39% versus 23% at 12 months. Median overall survival was 8.7 months versus 5.9 months in the gemcitabine arm.  AMG 479 is moving into a Phase 3 study for metastatic pancreatic cancer.

Threshold Pharmaceuticals, Inc. (THLD)

At the 2010 ASCO Annual Meeting, Threshold Pharmaceuticals presented results with its hypoxia-activated prodrug, TH-302, in combination with gemcitabine in thirty-four patients with advanced or metastatic pancreatic cancer that had at least one evaluable post-treatment tumor assessment.  One patient [3%] demonstrated a complete response as measured by RECIST [Response Evaluation Criteria In Solid Tumors] and 8 patients [24%] had a partial response.  Of the 34 assessed patients, 28 had elevated carbohydrate antigen CA19-9 levels at baseline and 17 of 28 [61%] had a CA19-9 reduction of greater than 50%.  This is important, as a greater than 20% decrease in levels of this tumor-associated antigen has been shown to correlate with improved overall survival. The biomarker CA19-9 has been shown to be highly specific and sensitive for pancreatic cancer and approximately three-quarters of all pancreatic cancer patients have elevated baseline serum CA19-9 level at baseline.

Neogenix Oncology, Inc. (private)

Neogenix Oncology is develping ensituximab, a novel, chimeric monoclonal antibody intended for the treatment of advanced pancreatic and colorectal cancer. Pre-clinical studies have demonstrated that NPC-1C specifically targets pancreatic and colorectal cancer sparing healthy tissue.  In 2010, the company initiated a multi-center Phase 1 trial in patients with late stage pancreatic or colorectal cancer being conducted at Johns Hopkins University Hospital, Duke University Medical Center, and North Shore University Hospital.  Neogenix is also exploring the diagnostic and prognostic utility of ensituximab using a new serum ELISA test in a prospective study.  Preliminary results demonstrate that the biomarker test can differentiate between blood serum of healthy donors and that of patients with colorectal or pancreatic cancer.  In addition, the results of the biomarker test indicate superior sensitivity as compared to commercially available CEA and CA19-9 assays.

Table 2. Select Pancreatic Products in Active Clinical Development*

* Based on ClinicalTrials.gov

Conclusion

In contrast to the prominent late-stage failures over the past five years, several drugs have recently shown promise for the treatment of pancreatic cancer.  Going forward, early detection using biomarkers, more effective treatments, and novel drug targets could provide new hope for the treatment of this deadly disease.

Standard frontline therapy for AML patients under the age of 60 consists of cytarabine  [AraC] combined with an anthracycline [such as daunorubicin or idarubicin] in what is commonly referred to as the 7+3 regimen.  While 45% of elderly patients with AML [70+ years old] achieved a complete response [CR] using this regimen, there was no improvement in overall survival and more than a third of patients died within the first eight weeks of treatment according to a recent study published in the journal Blood[i].  This is consistent with the CR rates of 40%–60% with conventional chemotherapy and disease-free survival of less than 20% at three years referenced in the literature[ii].

Since more than half of AML cases occur in patients over 60 years old, there is a need to develop better frontline therapies in this setting.  With five agents being investigated as frontline therapy for elderly AML patients in late-stage trials, the purpose of this article is to compare and contrast these programs – several of which have near-term catalysts for investors.

Hypomethylating Agents

SuperGen, Inc. (SUPG), Eisai Co. Ltd. (ESALF), and Johnson & Johnson (JNJ)

On June 30, 2010, preliminary results from a Phase III trial of Dacogen® [decitabine] as a frontline treatment for elderly patients [65+ years old] with AML were released.  While Dacogen did not meet the primary endpoint of overall survival, a trend was reported to be evident.  However, the failure to demonstrate an improvement in overall survival was surprising given the favorable Phase II results and the fact that the comparator arm received low dose AraC instead of the aforementioned 7+3 regimen.  Low dose AraC predominantly works in patients with favorable cytogenetics, so it should have been relatively easy for Dacogen to demonstrate a survival benefit.

Shares of SuperGen, which climbed as high as $2.89 on expectations for positive trial results, reached a new 52-week low of $1.71 in July.  Supergen receives a 20-30% royalty on worldwide sales of Dacogen from its development and commercialization partners – Eisai in North America and Johnson & Johnson outside of North America.

While investors appear to be discounting approval of Dacogen as a frontline therapy for elderly AML, there may be reasons for optimism.  For example, both Eisai and Johnson & Johnson are continuing to analyze the data and planning to move forward with North America and European regulatory filings in 2011 based on the primary analysis and secondary endpoints.  In addition, the Phase III study was conducted under a special protocol assessment [SPA] with the U.S. Food and Drug Administration [FDA].

Celgene Corporation (CELG)

In view of Dacogen’s negative Phase III trial results, investors may be skeptical about Vidaza® [azacitidine], another hypomethylating agent currently approved for the treatment of myelodysplastic syndromes [MDS], a pre-cancerous condition that can often progress to AML.  According to ClinicalTrials.gov [Identifier NCT01074047], Celgene is currently enrolling patients in a Phase III, multicenter, randomized, open-label, study of Vidaza versus conventional care regimens for the frontline treatment of elderly patients [65+ years old] with AML.

In December 2008, the European Commission granted marketing authorization for Vidaza as a treatment for patients with higher-risk MDS, chronic myelomonocytic leukemia [CMML], and MDS that transforms into AML with a blast percentage of 20-30% in the peripheral blood or bone marrow.  While Vidaza demonstrated a clinically relevant increase in median survival of 9.4 months [24.4 vs. 15 months] in these settings[iii], it is unclear how the drug will work in AML de novo patients with a higher blast percentage [greater than 50%] that represent half of the elderly patient population.  In view of the fact that Dacogen is more myelosuppressive than Vidaza [see Table 1], and for this reason may be preferred over Vidaza for off-label use in AML, the recent failure of Dacogen only adds to this uncertainty.

Table 1. Percentage of Patients with Myelosuppression from Prescribing Information

Monoclonal Antibodies

Seattle Genetics, Inc. (SGEN)

Seattle Genetics is developing SGN-33 [lintuzumab], an unconjugated IgG1 antibody for the treatment of AML.  Lintuzumab has been shown to induce cell death by both complement and/or antibody-directed cellular cytotoxicity, or as a direct effect of the engagement of the CD33 receptor, which is expressed in most leukemic blast cells but also in normal hematopoietic cells.

In a Phase II study in relapsed/refractory AML patients, single agent lintuzumab demonstrated efficacy in patients with advanced AML; however, the positive effects were confined to patients with low disease burden [blast percentage 5% to 30%].  This suggested that additional development of this agent would be best achieved by combining lintuzumab with chemotherapy.  However, while the addition of lintuzumab to salvage induction chemotherapy was safe, it did not result in a statistically significant improvement in response rate or survival in patients with refractory/relapsed AML in a subsequent Phase III trial[iv].

Seattle Genetics is now conducting a 210 patient Phase IIb study in frontline treatment of elderly patients [60+ years old] with AML with results expected in the August to October 2010 timeframe.  See ClinicalTrials.gov [Identifier NCT00528333] for more information.

While lintuzumab relies on a different mechanism of action, investor’s are understandably skeptical about the success of another anti-CD33 monoclonal antibody in AML.  In June 2010, Pfizer, Inc. (PFE) agreed to withdraw Mylotarg® [gemtuzumab ozogamicin] from the U.S. market, effective October 15.  Mylotarg is an IgG4 monoclonal antibody to CD33 linked to a cytotoxic agent from the class of calicheamicins.  Developed by Wyeth, the drug was fast-tracked to treat patients ages 60 and older with recurrent AML who were not candidates for other chemotherapy.  The FDA approved Mylotarg in May 2000 based upon a surrogate endpoint due to the fact it treated relapsed disease with no other viable therapy.

Four years later, a confirmatory trial was begun to confirm the results of the 142 patients who participated in the three previous clinical trials.  The 2004 trial showed that adding Mylotarg to existing chemotherapy for the treatment of AML provided no benefit and even showed a higher death rate.

Nucleoside Analogs

Genzyme Corporation (GENZ)

In September 2009, the FDA’s Oncologic Drugs Advisory Committee [ODAC] voted 9 to 3 that a randomized, controlled trial is needed to support the proposed label expansion for Clolar® (clofarabine) as a frontline treatment for elderly [60+ years old] patients with AML.  Consistent with the decisions for both Johnson & Johnson’s Zarnestra® [tipifarnib] and Vion Pharmaceuticals’ Onrigin® [laromustine], the committee determined that single-arm clinical study results were not sufficient for approval.

Despite the setback, Genzyme stated in a press release that the company remains committed to the clinical development of clofarabine in this patient population and that the drug is being investigated in clinical trials by most of the leading AML experts and major cooperative leukemia investigation groups in the United States and Europe.

Beyond the frontline setting, Genzyme is also conducting a randomized Phase III trial comparing clofarabine in combination with AraC to AraC alone in relapsed and refractory adult AML patients 55 years old or older [ClinicalTrials.gov Identifier NCT00317642]. Results are expected in 2011.

Note: At the time of writing, Sanofi-Aventis (SNY) has offered to acquire Genzyme for $69 per share.

Cyclacel Pharmaceuticals, Inc. (CYCC)

Cyclacel is developing sapacitabine for the treatment of AML, MDS and non-small cell lung cancer [NSCLC].  Sapacitabine is unique among the frontline, elderly AML landscape as it represents the only oral agent in late-stage clinical development and the only product candidate to demonstrate a survival benefit in a randomized study.

In December 2009, Cyclacel reported interim results from an ongoing Phase II study involving 60 patients aged 70 or older with either untreated AML [80%] or AML in first relapse [20%] randomized across three dosing schedules of sapacitabine [ClinicalTrials.gov Identifier NCT00590187].  The three-day dosing schedule in Arm C was selected for further clinical development in elderly patients with de novo AML based on a 1-year survival rate of 30% and an overall response rate of 35%.

In the first quarter of 2010, Cyclacel submitted a SPA request for a randomized, registration-directed, Phase III study of sapacitabine in elderly patients with AML and, pending the response, expects to initiate a pivotal Phase III study in 2010.

Summary

While many companies are developing therapies for AML [see Table 2], there is a need to focus on better frontline therapies for elderly patients given the lack of efficacy and significant toxicity associated with the current 7+3 treatment regimen.  Investors will be watching the following catalysts to help handicap which of the five product candidates [decitabine, azacitidine, clofarabine, sapacitabine, or lintuzumab] will win the race and become the first agent approved by the FDA in this setting:

• Phase IIb results for lintuzumab expected in the August to October 2010 timeframe
• FDA response to SPA request for Phase III study of sapacitabine; initiation of pivotal Phase III study in 2010
• Supplemental new drug application [sNDA] for decitabine by March 31, 2011 and subsequent response from FDA
• Results from frontline clofarabine clinical trials by AML experts and major cooperative leukemia investigation groups in the United States and Europe; relapsed/refractory AML Phase III results in 2011
• Phase III results for azacitidine expected around 2013

NEW – Click here to view this article in PDF format.

Table 2. Late-stage Therapeutic Landscape for AML

References

[i] Kantarjian H, Ravandi F, O’Brien S, Cortes J, Faderl S, Garcia-Manero G, Jabbour E, Wierda W, Kadia T, Pierce S, Shan J, Keating M, Freireich EJ.  Intensive chemotherapy does not benefit most older patients (age 70 years or older) with acute myeloid leukemia. Blood. 2010 Jul 28. [Epub ahead of print]

[ii] Amadori S, Suciu S, Willemze R, Mandelli F, Selleslag D, Stauder R, Ho A, Denzlinger C, Leone G, Fabris P, Muus P, Vignetti M, Hagemeijer A, Beeldens F, Anak O, De Witte T; EORTC leukemia group; GIMEMA leukemia group.  Sequential administration of gemtuzumab ozogamicin and conventional chemotherapy as first line therapy in elderly patients with acute myeloid leukemia: a phase II study (AML-15) of the EORTC and GIMEMA leukemia groups.  Haematologica. 2004 Aug;89(8):950-6.

[iii] Edlin R, Connock M, Tubeuf S, Round J, Fry-Smith A, Hyde C, Greenheld W.  Azacitidine for the treatment of myelodysplastic syndrome, chronic myelomonocytic leukaemia and acute myeloid leukaemia. Health Technol Assess. 2010 May;14 Suppl 1:69-74.

[iv] Eric J. Feldman, Joseph Brandwein, Richard Stone, Matt Kalaycio, Joseph Moore, Julie O’Connor, Nancy Wedel, Gail J. Roboz, Carole Miller, Raj Chopra, Joseph C. Jurcic, Randy Brown, W. Christopher Ehmann, Philip Schulman, Stanley R. Frankel, Daniel De Angelo, David Scheinberg.  Phase III Randomized Multicenter Study of a Humanized Anti-CD33 Monoclonal Antibody, Lintuzumab, in Combination With Chemotherapy, Versus Chemotherapy Alone in Patients With Refractory or First-Relapsed Acute Myeloid Leukemia. Journal of Clinical Oncology, Vol 23, No 18 (June 20), 2005: pp. 4110-4116.

With few exceptions, companies with monoclonal antibody platforms have significantly outperformed the NASDAQ Biotechnology Index® (NBI) since the end of 2008 [see Table 1].  Accordingly, the purpose of this article is to offer several key factors that help explain the above average returns for monoclonal antibody companies during this +18-month period – a trend that we believe is likely to continue.

Table 1: Select public companies with monoclonal antibody platforms

Higher rate of success

In order to determine the appropriate current value for a biotechnology company, an investor would normally consider projected future cash flows resulting from product sales, probability of success, and a discount rate to reflect the risks that the company faces.

With regard to probability of success, one of the greatest considerations for a biotechnology company is the fact that new drug candidates must receive approval from the Food and Drug Administration [FDA] before they can be marketed in the United States.  Receiving FDA approval is dependent, in part, on the drug candidate successfully passing a series of clinical trials that are generally conducted in three sequential phases.

Successfully transitioning from the early stages that establish safety [Phase I] to later phases where efficacy is demonstrated [Phase III] will improve the approval success rate [e.g., the odds that the drug will ultimately reach the market].  Interestingly, researchers from the Tufts Center for the Study of Drug Development at Tufts University recently analyzed the average approval success rates for investigational drugs first tested in humans from 1993 to 2004 [Ref 3] and found substantial differences between large molecules [32% success rate] and small molecules [13% success rate].  Monoclonal antibodies represented the largest group [47%] of the large molecules evaluated in the study.

In view of the fact that nearly one-third of large molecule product candidates entering the clinic ultimately receive FDA approval and that they are nearly 2.5-times more likely to ultimately receive approval than small molecule compounds, companies that are developing monoclonal antibodies should be awarded higher valuations due to the higher probability of success.

Reduced concerns from biosimilars

The Patient Protection and Affordable Care Act [PPACA], which was signed into law on March 23, 2010, included a provision amending the Public Health Service Act [PHSA] to permit approval of biosimilar biological products through an abbreviated biological license application [ABLA] submitted to the FDA.  Under the law, originators have a 12-year exclusivity period before a biosimilar is approved.

While many questions remain about the specifics of the ABLA process until the FDA releases its guidance, the PPACA does state that to support approval of a biosimilar, the sponsor must show that the product is “biosimilar to the reference product” based upon data derived from analytical, animal, and clinical studies.  As a result, it is unlikely that monoclonal antibody products will represent the first class of biosimilars on the market due to the fact that they have very specific binding properties and are typically larger and more complicated than other biologic drugs.

Regardless, according to a recent article by Ludwig Burger for Reuters, analysts expect price discounts of only 20 to 30 percent in markets affected by biosimilar competition, which compares with an average markdown of 90 percent for generic versions of small molecule drugs. This is likely due to the fact that development, production and marketing of a biosimilar costs more than making a generic copy of conventional chemical drugs.

Lastly, for those individuals that believe manufacturing biologic drugs is easy, a review of Genzyme Corporation’s (GENZ) recent challenges offers a different perspective.  See “Genzyme’s Manufacturing Disruption Highlights Investment Opportunities in Lysosomal Storage Disorders.”

Manufacturing processes have improved

In contrast to small molecule therapeutics that can be synthesized for $1 per gram and simple proteins like insulin that can be efficiently produced in bacterial hosts, monoclonal antibodies are normally produced in mammalian cells at a cost of $300-$5,000 per gram [Ref 4].

Fortunately, in parallel with the clinical and commercial success of monoclonal antibodies there have been major advances in cell line development, bioreactor construction and operation, purification strategies and analytics. For example, cell culture productivity has improved more than 100-fold in the last 15-years.  With these advances, global protein output using mammalian cell culture increased from under 500 kilograms in 2000 to 3,600 kilograms in 2005 and manufacturing costs have been reduced.

In addition to the aforementioned advances, new sources of inexpensive antibody production are being explored.  For example, antibodies have been expressed successfully in genetically modified plants and have been shown to retain their native functional forms.

Evolution from acute to chronic treatment

In the early 1980’s, most monoclonal antibodies were derived from mouse genes with major limitations such as inducing human anti-mouse antibody [HAMA] responses in patients, lack of effector functions and short plasma half-life [Ref 5].  Later that decade, genetic engineering techniques made chimeric and humanized versions available for study.  Until this point in time, most therapeutic monoclonal antibodies had been studied as acute treatments for cancer or immunological diseases [Ref 6].

By the late 1990’s, methods to produce human monoclonal antibodies were developed, including phage display and transgenic mice.  With the availability of human antibodies with reduced immunogenicity and increased efficacy, the biotechnology industry began studying monoclonal antibodies for the chronic treatment of non-life threatening diseases, which opened new market opportunities.

In this regard, KaloBios Pharmaceuticals, Inc. (private) is applying its proprietary Humaneering™ technology platform to produce antibodies that are close to human germ-line in sequence while retaining the specificity and improving the affinity of the reference antibody.  KaloBios is developing an anti-GM-CSF human monoclonal [KB003] for the treatment of patients with autoimmune and chronic inflammatory conditions, such as rheumatoid arthritis and asthma.  Sales of two marketed monoclonal antibodies indicated for the treatment of rheumatoid arthritis, Humira® [adalimumab] and Remicade® [infliximab], are projected to reach $15.8 billion in combined sales by 2016 according to Evaluate Pharma [Ref 2].

In January 2010, KaloBios partnered with Sanofi Pasteur, the vaccines division of sanofi-aventis Group (SNY), to develop the company’s Humaneered™ antibody fragment KB001 for the prevention and treatment of Pseudomonas aeruginosa (Pa) infections. KaloBios received an upfront payment of $35 million and is eligible for development, regulatory and commercial milestones totaling $255 million in addition to royalties on eventual product sales.

In addition, MacroGenics, Inc. (private) entered into a global strategic alliance with Eli Lilly & Co. (LLY) in October 2007 valued at approximately $500 million for teplizumab, a humanized anti-CD3 monoclonal antibody currently being studied in a global pivotal Phase II/III clinical trial for individuals with recent-onset type 1 diabetes.

Licensing, merger, and acquisition dynamics

The higher average approval success rates with large molecules compared with small molecules appears to be partially reflected in the economics of some recent licensing and M&A transactions.

For example, in June 2010 OncoMed Pharmaceuticals, Inc. (private) partnered with Bayer Schering Pharma AG (BAYRY.PK) to discover, develop and commercialize novel anti-cancer stem cell therapies including multiple antibody, protein therapeutics and small molecules targeting the Wnt signaling pathway.  For each drug candidate successfully developed through Phase III clinical trials and regulatory approval, OncoMed’s payments from Bayer could total up to $387.5 million for each biotherapeutic drug compared with $112 million for small molecule drugs.  Accordingly, potential payments for large molecules are 3.5 times greater than for the small molecules.

As another example, Eli Lilly & Co. (LLY) acquired ImClone Systems, Inc. for $6.5 billion [5x sales of $1.3 billion], while Astellas Pharma, Inc. paid $4 billion for OSI Pharmaceuticals, Inc. [3.3x sales of $1.2 billion].  Both ImClone and OSI received royalties on product sales from corporate partners.

ImClone’s marketed product Erbitux® [cetuximab] is a monoclonal antibody that inhibits the epidermal growth factor receptor [EGFR] and is indicated for the treatment of certain types of colorectal cancer and as a single agent or in combination with radiation therapy for head and neck cancer.  OSI’s comparable product Tarceva® [erlotinib] is a small molecule antagonist of EGFR and is indicated for the treatment of non-small cell lung cancer and pancreatic cancer.  While this is not an apples-to-apples comparison, it does help support the fact that premiums are being paid for monoclonal antibodies versus small molecules.

Investors are also likely placing M&A premiums on monoclonal antibody companies due to robust activity during the past five years [see Table 2].  In fact, there has been at least one deal announced each year during this period.

Table 2: Select M&A among monoclonal antibody companies

Access to capital

Despite a challenging financing climate, many public monoclonal antibody developers referenced in Table 1 have been able to raise capital through public offerings.  For example, ImmunoGen, Inc. (IMGN) raised $77.6 million at $8.00 per share in May 2010, Micromet, Inc. (MITI) raised $80.5 million at $7.00 per share in March 2010, and Seattle Genetics, Inc. (SGEN) raised $136 million at $10.75 per share in August 2009.  This demonstrates strong investor appetite for monoclonal antibody companies, which could bode well for future initial public offerings [IPOs] given the paucity of public options in the sector due to M&A activity over the past few years.

Summary

Biotechnology companies developing monoclonal antibodies have been outperforming the broader sector for the past 18-months, a trend that is likely to continue based on higher average approval success rates, reduced concerns from biosimilars, improvements in manufacturing and resulting impact on margins, broadening utility beyond treating cancer and inflammation, robust partnering and M&A activity, and access to capital.

References

1. Roche Annual Report 2009 (www.roche.com/gb09e.pdf)
2. Evaluate Pharma World Preview 2016 Report
3. DiMasi, JA. Et al. Clin Pharmacol Ther. 2010 Mar;87(3):272-7. Epub 2010 Feb 3.
4. Chen, C. Trends in Bio/Pharmaceutical Industry. 2009 5(3).
5. Chan, A. Et al. Nat Rev Immun. 2010 May;10.
6. Reichert JM. Curr Pharm Biotechnol. 2008 Dec;9(6):423-30.

Product pricing and reimbursement

The cost of Provenge has been set at $93,000 for a course of treatment, which consists of three infusions at approximately two-week intervals.  In view of the fact that Provenge has been demonstrated to extend survival by 4.1 months, this translates into an average cost of $23,000 per month of added survival.

In comparison, Taxotere® [docetaxel] by Sanofi-aventis (SNY) is indicated for the treatment of patients with androgen independent [hormone refractory] metastatic prostate cancer and administered every 3 weeks for 10 cycles.  Assuming an average monthly cost of $4,000 for Taxotere [source: Cancer Res 2009;69(24 Suppl):Abstract nr 1076], this is an approximate total cost of $40,000 per patient. In the pivotal TAX 327 study, median survival for prostate cancer patients receiving Taxotere was 18.9 months versus 16.5 months in the control arm, which results in an average cost of $16,666 per month of added survival.  Unlike Provenge, however, treating common adverse reactions with Taxotere, such as infections, neutropenia, anemia, nausea, diarrhea, and others, increases the total cost of therapy – so the pricing of Provenge doesn’t appear completely out of line. [note: updated survival analysis of the TAX 327 study demonstrates a 2.9 month survival advantage, which lowers the average cost to $13,793 per month of added survival with Taxotere.  Source: Journal of Clinical Oncology, Vol 26, No 2 (January 10), 2008: pp. 242-245.]

Nonetheless, the Centers for Medicare and Medicaid Services [CMS] has initiated a National Coverage Analysis [NCA] of Provenge. In CMS’s announcement of the NCA, CMS is requesting public comments on the effects of Provenge on health outcomes in patients with prostate cancer. While the news doesn’t reflect a change in Medicare coverage policy or impact existing coverage decisions and a decision isn’t expected for a year, it does highlight sensitivity on the part of payors over the pricing of certain cancer treatments.

Supply constraints

Dendreon is making Provenge available through approximately 50 centers, all of which were approved Provenge clinical trial sites, and expects to increase capacity over the next year.  The increased capacity will be a result of the anticipated licensure of its expanded New Jersey, Georgia and California facilities in mid-2011.

In the short term, however, Dendreon officials have indicated that the company will only be able to supply 2,000 treatments to patients.  At a cost of $93,000 per treatment, this limits potential sales to approximately $186 million.

According to a June 28 article by Bloomberg reporter Tom Randall, Dendreon’s Chief Operating Officer Hans Bishop indicated that facilities will be able to churn out medicine each year valued at between $1.25 billion and $2.5 billion by the end of 2011.

Competitive landscape

In early April 2010, we published a 150-page industry report titled “Cancer Vaccine Therapies: Failures and Future Opportunities,” which included an overview of the cancer immunotherapy market, interviews with several key opinion leaders, profiles of nearly 40 companies, and a discussion of the scientific, clinical, and commercial considerations for the major industry participants.

In the report, we highlighted the fact that numerous active immunotherapies are in late-stage clinical development for prostate cancer.  In fact, nine product candidates are in clinical trials for the treatment of prostate cancer, representing the largest therapeutic area within the active immunotherapy market.  Beyond competition from other active immunotherapies, however, Provenge could also face competition from small molecule products.

For example, Johnson & Johnson (JNJ) acquired Cougar Biotechnology, Inc. for approximately $1.0 billion in cash in 2009.  Cougar Biotechnology’s oncology portfolio included abiraterone acetate [CB7630], an orally active acetate salt of the steroidal compound abiraterone.  Abiraterone acetate, which can suppress testosterone production by both the testes and the adrenals to castrate-range levels, is currently in two Phase III clinical trials for the treatment of prostate cancer according to ClinicalTrials.gov [Trial identifier numbers NCT00638690 and NCT00887198].  Both studies list a primary completion date of mid-2011.

Insider sales

Trading conducted by corporate officers, key employees, directors, or significant shareholders must be reported to the Securities and Exchange Commission [SEC], usually within a few business days of the trade.  Some investors follow the activity of insiders, believing that they might have better insights into the health of a corporation and that their trades convey important information – although this isn’t always the case.

In this regard, according to a Form 4 filed with the SEC, Dendreon’s Chief Executive Officer [CEO] beneficially owned 555,211 shares of the company’s common stock as of April 29, 2010 – the day Provenge was approved by the FDA.  The CEO sold more than half of those shares at prices ranging from $51 to $54.70, reducing his beneficial holdings to 224,359 the next day.  Other insiders also sold during the period.

Priced for perfection

Recall that Eli Lilly & Co. (LLY) purchased ImClone Systems for $6.5 billion back in 2008.  ImClone’s only product – Erbitux® [cetuximab] – had generated annual sales of approximately $1.3 billion in 2007.  Therefore, ImClone was valued at a 5x multiple to prior year sales.

At its 52-week high, Dendreon had a market capitalization of approximately $7.8 billion.  At a 5x multiple, this would imply an annual revenue run rate of $1.56 billion, which is consistent with the company’s planned manufacturing capacity by the end of 2011 and many analyst projections over the coming years.

But Dendreon isn’t generating $1.56 billion in annual sales yet and concerns over pricing, reimbursement, and competition, combined with insider selling, help explain the decrease in market valuation since the approval of Provenge.

* MD Becker Partners reporting live from the JP Morgan Healthcare Conference

This week, nearly 6,500 registrants gathered in San Francisco, California for the JP Morgan Healthcare Conference to hear 25-minute presentations from 338 life science companies.  For industry executives and investors, the annual event serves as a good barometer for the rest of the year.

We roamed the familiar halls of the Westin St. Francis Hotel to assess the mood among participants and also monitored online media commentaries throughout the event.  In general, there was a flurry of activity, the plane flights and networking receptions were crowded as usual, and several industry observers “Tweeted” a sense of optimism for 2010.  However, we sought to construct a less subjective assessment by analyzing year-over-year statistics from the conference.

Accordingly, we extensively reviewed company press releases issued during the JP Morgan Healthcare Conference in both 2009 and 2010, with a particular focus on identifying the number of merger & acquisitions, licensing & partnering transactions, and financing deals announced each year during the four day event.

Merger and Acquisitions

In contrast to the absence of any significant M&A deals announced during the JP Morgan Healthcare Conference in 2010, several large M&A transactions with an aggregate value of $702 million were disclosed during the first two days of the event in 2009 [January 12-15, 2009].  The largest deal went to Cephalon, Inc. (CEPH), which announced an agreement providing the company with an option to purchase all outstanding capital stock of Ception Therapeutics, Inc., a privately held biopharmaceutical company.  Under the terms of the option agreement, Cephalon paid Ception $100 million upfront for the option.  If Cephalon exercises its option, the company will purchase all of the outstanding capital stock of Ception for $250 million along with additional payments related to clinical and regulatory milestones.  Other transactions announced that year included:

• Medtronic, Inc.’s (MDT) acquisition of privately held Ablation Frontiers, Inc. for an initial payment of $225 million plus potential additional payments contingent upon achievement of certain clinical milestones
• The Medicines Company’s (MDCO) merger agreement with Targanta Therapeutics Corporation for $42 million in cash and additional regulatory and commercial milestone payments
• NuVasive, Inc.’s (NUVA) option to acquire Progentix Orthobiology BV, a Netherlands based company focused on developing novel orthobiologics, consisting of an upfront investment of $15 million along with the obligation to purchase the remaining equity of Progentix for $45 million upon accomplishment of certain development milestones [with additional potential payments of up to $25 million upon the achievement of additional milestones and based upon NuVasive's sales success]

Licensing and Partnering

Kicking off the JP Morgan Healthcare Conference in 2010, privately held KaloBios Pharmaceuticals, Inc. announced a $290 million agreement with Sanofi Pasteur, the vaccines division of the sanofi-aventis Group (SNY), for the development and commercialization of KB001, an investigational new biologic for the treatment or prevention of Pseudomonas aeruginosa [Pa] infections.  KaloBios, which is developing first-in-class human antibody therapeutics that offer advantages over other methods of human antibody creation in terms of immunogenicity, potency, and manufacturing yields, will receive an upfront payment of $35 million, plus development, regulatory and commercial milestones for a potential further $255 million, as well as royalties on eventual product sales.

While other licensing and partnering transactions were announced during the JP Morgan Healthcare Conference in 2010, they were substantially smaller or specific financial terms were not disclosed.  These include:

• Proteus Biomedical Inc. announced an exclusive worldwide license and collaboration agreement with Novartis AG (NVS) to develop and commercialize pharmaceutical products that incorporate Proteus’ novel sensor-based technologies in the field of organ transplantation along with certain option rights in cardiovascular and oncology product applications.  Under the terms of the agreement, Novartis will make upfront cash and equity investments in Proteus totaling $24 million and Proteus will also receive royalties on worldwide net sales of any Novartis products incorporating its sensor-based technology.
• Trillium Therapeutics, Inc., a biopharmaceutical company developing innovative immune-based biologics, announced that it has entered into a definitive license agreement with Biogen Idec, Inc. (BIIB), granting the latter exclusive worldwide rights to one of Trillium’s development programs.  Under the terms of the agreement, Trillium will receive an upfront payment and is eligible to receive milestone payments based on achievements of specified clinical, regulatory and commercial accomplishments.  Trillium will also receive royalties on global product sales.  Biogen Idec will be solely responsible for clinical development, regulatory approvals, manufacturing and commercialization.
• MedGenesis Therapeutix Inc., a biopharmaceutical company developing and commercializing innovative treatments for patients with serious central nervous system [CNS] diseases, announced an agreement with Amgen, Inc. (AMGN) that provides MedGenesis with an exclusive, worldwide license for glial cell line-derived neurotrophic factor [GDNF] protein in CNS and non-CNS indications.  As part of the license agreement, Amgen now holds a small equity stake in MedGenesis.  In parallel, Biovail Corporation (BVF) and MedGenesis concluded an agreement to collaborate on the development of GDNF in Parkinson’s disease and potentially other CNS indications.  GDNF is a naturally-occurring growth factor capable of protecting and promoting the survival of dopamine producing nerve cells.
• AstraZeneca Plc (AZN) and CrystalGenomics announced a research collaboration to discover and develop a novel anti-infective for use as a potential antibacterial agent.  Under the terms of this agreement, Korea-based CrystalGenomics will receive research funding from AstraZeneca for two years.  CrystalGenomics will also be eligible to receive future milestones and royalty payments associated with development and commercialisation of a drug candidate.
• AnaptysBio, Inc., a privately-held therapeutic antibody platform and product company, announced it has signed an agreement with Roche (RHHBY) for the development of novel antibody therapeutics.  Under the terms of the agreement, AnaptysBio will be responsible for generating novel antibodies using its proprietary somatic hypermutation platform and Roche will receive a worldwide license to develop and commercialize antibodies optimized by AnaptysBio.  In addition to a signing fee paid by Roche, AnaptysBio will be eligible to receive milestone payments and royalties upon product sales.

The six transactions announced during the JP Morgan Healthcare Conference in 2010 with reported financial terms totaling $314 million pale in comparison to the ten deals reported at the meeting during 2009 worth more than $2.4 billion in aggregate value.  These included a $1.1 billion deal between ZymoGenetics, Inc. (ZGEN) and Bristol-Myers Squibb Company (BMY), a $500 million deal between Peptimmune, Inc. and Novartis AG, a $396 million deal between Micromet, Inc. (MITI) and Bayer AG (BAYZF.PK), and a $200 million deal between FORMA Therapeutics the Novartis Option Fund to develop inhibitors for an undisclosed protein-protein interaction target in the field of oncology, among others.

Financing

The quantity and aggregate dollar value of public and private financing transactions announced during the JP Morgan Healthcare Conference were essentially flat in 2010 compared with the prior year as reflected in the table below.

Outlook

At the start of 2009, we provided a positive outlook for biotechnology, citing the sector’s defensive characteristics, favorable technical aspects, and improving fundamentals, such as the number of new product approvals, products in clinical trials and the brisk pace of industry consolidation and licensing transactions.  The latter was quickly reinforced by M&A transactions with an aggregate value of $702 million and licensing & partnering deals worth more than $2.4 billion in aggregate value announced January 12-15, 2009, during the JP Morgan Healthcare Conference. 

While we believe that a positive outlook for 2010 is once again warranted, and the first two weeks of the year don’t necessary indicate a trend, hopefully the paucity of M&A activity coupled with the decline in both the quantity and value of licensing & partnering transactions announced during the JP Morgan Healthcare Conference in 2010 is simply the pause that refreshes and the action improves throughout the year.

In healthy patients, insulin is released from pancreatic B cells in response to elevated glucose which causes depolarization through the closing of ion gated K+ channels and opening of Ca2+ channels.  The increased intracellular Ca2+ levels results in insulin release from the B cells entering the circulation.  The primary target of insulin is the insulin receptor found in many tissues including the liver, brain, and muscle.  Activation of this receptor initiates a complex signaling network resulting in energy storage, cell growth, and metabolism. Circulating insulin is cleared through the liver (60%) and the kidneys (40%).

Diabetes is a chronic, long-term disease with treatments focusing on disease management.  This includes drugs and devices that alter and monitor insulin levels.    Patients with abnormal insulin levels or who are insulin resistant may develop a series of complications as a result of metabolic derangements such as cardiovascular disease, stroke, nephropathy, retinopathy, peripheral neuropathy, renal failure, and amputations of the extremities. Therefore, new medications that allow for tighter control of insulin levels are needed. 

There are a number of drugs available for patients with type-2 diabetes mellitus. The oral anti-diabetic agents are categorized in four classes based on the mechanism of action: biguanides (reduced gluconeogenesis) thiazolidinediones (PPAR-g ligands), insulin secretagogues (closure of K+ channels on B cells), and a-glucosidase inhibitors (inhibitors of a-glucosidases).  Many of these drug classes have more established profiles such as the insulin secretagogues and biguanides and are the first line of therapy for early stage type-2 diabetes.  In addition, several of these drugs are available in generic forms.  Many patients with type-2 diabetes unable to make lifestyle modifications are unable to achieve normal glucose levels and require a combination of oral anti-diabetic medicines and insulin analogs. 

Several different insulin analogs are available for type-1 and advanced type-2 diabetic patients.  The injected insulin types differ in their onset and duration.  The main players in this area are many of the larger pharmaceutical companies including Lilly (LLY), Sanofi-Aventis (SNY), Novo Nordisk (NVO) and Pfizer (PFE).  Total sales of insulin analogs in 2006 were greater than $4 billion. 

Current strategies for physicians treating diabetics are through the drug classes mentioned above resulting primarily in diabetes management.  Many new insulin altering drugs have entered the market in the past 10 years, but there is mixed evidence that these new drugs are superior to more established therapies (Ref 2-5) probably because many of these drugs are active on the same molecular sights as previously approved drugs.  Importantly, as the number of patients with diabetes increases, developing new medicines that reduce the cost of long-term treatment for this chronic disease will become a necessity. 

PPAR and GLP-1 receptor agonists

As discussed at the recent ADA meeting, new technology and approaches for treating these patients is changing and the competition to secure the growing market is fierce (see Table 1 below for a summary). Eli Lilly and Co. and Amylin Pharmaceuticals Inc. (AMLN), makers of Byetta, recently announced a new formulation of this drug that changes the dosing from twice daily to weekly.  Positive results from this clinical trial are encouraging for many of the patients who are non-compliant with this medication.  Roche (RHHBY) also announced that it would begin a phase 3 trial for its PPAR-g agonist R1439, which demonstrated improved cardiovascular morbidity in high-risk diabetes patients.

Xoma

XOMA (XOMA) presented data from one of its diabetes antibody candidates XOMA-52, which is a clinical stage IL-1b antibody for patients with type-2 diabetes.  IL-1b plays a role in the auto-inflammatory response leading to decreased beta cell function.  XOMA-52 is unique to other IL-1b inhibitors because of its high affinity (K_D is fM) and long half-life (22 days).  As a result, patients need to be injected with XOMA-52 once monthly and should increase patient compliance.    In addition to safety and pharmacokinetic data, the Phase I trial demonstrated decreased HbA1c levels, a key indicator of blood sugar control, and improved beta cell function.  XOMA-52 is an attractive drug candidate because it preserves endogenous insulin production in patients with advancing type-2 diabetes. In addition to clinical data, XOMA also presented detail mechanistic rodent and in vitro data on XOMA-52, confirming the results seen in the clinical study.   

Halozyme

For patients with type-1 diabetes, Halozyme (HALO) recently presented Phase 2 data that showed improved pharmacokinetics and glucodynamics with patients receiving Lilly’s Humalog and co-administration of Halozyme’s PH20 enzyme. PH20 is a recombinant hyaluronidase enzyme that catalyzes the hydrolysis of hyaluronic acid, a major constituent of the interstitial barrier, and increases tissue permeability. This study demonstrated an improved blood glucose metabolism profile in patients taking the combination therapy, reflecting a more physiologic glucose profile thereby likely reducing the amount of exogenous insulin needed along with some potential complications such as hypoglycemia.

Appetite Control

In addition to reformulations, several companies presented data on new drug targets and technologies. VIVUS, Inc. (VVUS) presented data from a year-long Phase 2 trial with Qnexa demonstrating reduced HbA1c levels and helped patients achieve and maintain significant weight loss through appetite suppression.  Qnexa is a combination therapy of FDA approved phentermine and topiramate, which in combination have synergistic effects through unique molecular targets resulting in reduced appetite and increased satiety.  Arena Pharmaceuticals, Inc. (ARNA) presented Phase 3 data from its BLOOM (Behavioral modification and Lorcaserin for Overweight and Obesity Management), demonstrating significant weight loss and reduced secondary endpoints associated with cardiovascular disease after one year of treatment compared to placebo. Lorcaserin is a novel serotonin 2C receptor agonist; selective activation of this Gq-coupled GPCR in the hypothalamus leads to appetite control and increased metabolism. 

Isis

Isis Pharmaceuticals, Inc. (ISIS) presented preclinical data on ISIS-SGLT2Rx, an antisense biologic targeting knockdown in sodium dependent glucose co-transporter type 2 (SGLT2) levels that resulted in a significant reduction in blood glucose levels in multiple animal species. Isis is experienced in RNA targeting drugs and has already commercialized the world’s first antisense drug.   This novel technology allows Isis to target dysfunctional proteins through decreased transcriptional levels thus modifying signaling pathways not attainable through small molecule inhibition.  Antisense technologies may play a key role in finding drugs with unique targets previously unreachable ultimately leading to improved disease management and quality of life.  

Sangamo

Sangamo BioSciences, Inc. (SGMO) presented data from its Phase 2 trial for SB-509 as a treatment for diabetic neuropathy (DN) resulting in statistically significant and clinically relevant improvements in subjects. DN is a severe physiological consequence of chronic elevated blood glucose levels and is seen in many patients with advanced diabetes.  SB-509 is an injectable plasmid encoding a DNA-binding Zinc Finger DNA-binding Protein (ZFP) Transcription Factor (ZFP TF™) designed to upregulate the endogenous expression of the gene encoding vascular endothelial growth factor (VEGF), a peptide responsible for angiogenesis. 

The preclinical and clinical data presented at the ADA gives investors, physicians, and patients a preview of the new drugs and technologies to come.  Many of these drugs are several years away from commercialization; however, because of the new technology, new target, or new delivery method, the outlook remains positive for these drugs and companies in the expanding market of diabetes control.

Table 1: Summary

References

1. Canaccord Adams. Diabetes 2007 and Beyond: Innovation, Demographics and Lifestyle Trends Drive Industry Growth. August 2, 2007
2. UK Prospective Diabetes Study Group. Effect of intensive blood-glucose control with metformin on complications in overweight patients with type 2 diabetes (UKPDS 34). Lancet 1998; 352: 854–65.
3. UK Prospective Diabetes Study Group. Effect of intensive blood-glucose control with sulphonylureas or insulin compared with conventional treatment and risk of complications in patients with type 2 diabetes (UKPDS 33). Lancet 1998; 352: 837–53.
4. Kahn SE, Haffner SM, Heise A, et al, for the ADOPT Study Group. Glycemic durability of rosiglitazone, metformin or glyburide as monotherapy in type 2 diabetes. N Engl J Med 2006; 355: 2427–43.
5. Nathan DM. Finding new treatments for diabetes—how many, how fast… how good? N Engl J Med 2007; 356: 437–40.

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About MD Becker Partners LLC

MD Becker Partners is a boutique management and strategy consulting firm focusing on both public and private companies in emerging growth industries, such as pharmaceuticals, biotechnology, medical devices, and cleantech. The firm’s mission is to bring experience-based insights gleaned from the three independent disciplines of investor relations, strategic advisory and operational improvement together and apply them to carefully conceived and expertly enacted strategies that help companies increase visibility, unlock value and access resources to grow their business. For more information, visit the website: http://www.mdbpartners.com/

Disclaimer: This article contains the author’s own opinions, and none of the information contained therein constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. To the extent any of the information contained in the article may be deemed to be investment advice, such information is impersonal and not tailored to the investment needs of any specific person.