Drug Repositioning

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					                               Research & Development Strategies

                                            Drug Repositioning

                                                                                                                                              a report by
                                                                                                       T h o m a s R e i l l y 1 and N i c o l e Y o s t 2

                                                             1. Vice President, BTG Drug Repositioning and 2. Marketing Programmes Manager, BTG Plc

                                            The biopharmaceutical industry is experiencing a        thereby extending patent protection for a number of
                                            difficult period in that productivity, as measured by   years. When DR is most successful it results in a new
                                            the launch of new products, has not kept pace with      drug that meets an unmet medical need. Enhanced
                                            the enormous increases in research and                  versions of existing drugs offering better patient
                                            development (R&D) spending. This productivity           compliance, improved absorption or bioavailability
                                            problem, coupled with increasing generic                also do well in the DR arena.
                                            competition and regulatory hurdles, has forced
Thomas Reilly joined BTG, where he          many companies to evaluate new business                 Within big pharma, DR constitutes nearly 10% of
     is Vice President of BTG’s Drug        paradigms. For example, the increased merger and        R&D spend and is viewed as an important part of
Repositioning Group, in 2002. Prior
        to joining BTG, he was Senior
                                            acquisition activities represent one type of industry   product life-cycle management with a focus on
    Director of Business Development        response to the productivity challenge. Another         expanding internal brands. For a number of
        and Strategic Planning, at the      industry response has been a renewed emphasis on        reasons, including the paucity of DR opportunities
   DuPont Pharmaceuticals Company.
   Between 1988 and 2000, he held           drug repositioning (DR) to preserve and extend the      that might offer peak sales potential in excess of
 positions of increasing responsibility     value of the patent and/or the brand, and to create     US$500 million/year (a typical big pharma hurdle
         in the Cardiovascular Diseases
        Research Group at the DuPont
                                            new market opportunities with generic drugs. DR         rate), and a general reluctance by big pharma to
          Pharmaceuticals Company. As       strategies are currently being pursued to some          out-license assets, these companies are neither a
         Senior Director of this group,     degree by big pharma, speciality pharma, drug           principal source nor buyer for DR opportunities.
         he developed and managed a
               multidisciplinary research   formulation and generics firms.                         However, on occasion they may acquire rights to
              department where he was                                                               certain DR opportunities that meet specific
responsible for identifying new drug
                                            In broad terms, DR strategies are classified into two   internal business needs.
  targets and directing several major
discovery programmes. Dr Reilly has         basic approaches: new indications and new
a PhD in microbiology from Rutgers          formulations/drug delivery for approved drugs. The      In contrast to big pharma, DR is viewed as a primary
    University, and an MBA from the
University of Delaware. He is also a        formulation/delivery approach is the most common        source of value creation and generation by many
          Fellow of the American Heart      DR strategy. Best Practices LLC has found that 71%      companies in the speciality pharma segment. A
       Association, holds four different    of companies with marketed pharmaceutical               speciality pharma company is one that lacks internal
               patents and has over 80
 publications in peer-review journals.      products evaluate some aspect of reformulation or       discovery capacities, and that generally focuses on
                                            delivery as part of their life-cycle management         one or two key therapeutic areas, often in niche
                                            strategy (PharmaVoice, June 2006). Deal flow for        markets. Such companies have clearly benefited from
                                            reformulated products continues to be both brisk        investor desire to fund pharmaceutical opportunities
                                            and lucrative. New indication strategies are also       with reduced development risk versus traditional
                                            commonly practised with 60% of the polled               new chemical entities (NCEs). As of April 2005, 14
                                            companies evaluating this approach (PharmaVoice,        such companies had raised about US$1.4 billion to
                                            June 2006). Actual dollar gains for new indication      move 28 re-profiled compounds into the clinic.
                                            products can be quite high, with many such              These companies represent a source of potential DR
                                            products resulting in annual sales ranging from         opportunities to prospective partners and licencees.
       Nicole Yost joined BTG Plc in
       September 2005 as Marketing          US$50 million to US$500 million. These trends           The need of speciality pharma companies to fill their
Programmes Manager. Prior to BTG,           suggest that industry interest in DR continues to be    pipelines with clinical projects also fuels the demand
       she worked in pharmaceutical
  publishing and has held a variety         strong, and that the economics can be very              for new DR opportunities.
 of posts including Science Reporter        favourable. However, they also emphasise the
     for Scrip World Pharmaceutical         competitive nature of the DR area and the               A third class of DR companies includes formulation
News, Editor of Target World Drug
Delivery News and launch Editor of          importance of carving out a differentiated strategy     companies, which develop new formulations and/or
        BioPartnering Today. She has        for growing and sustaining a DR business.               delivery routes for existing products and offer discrete
     written many feature and news
    articles for a variety of industry
                                                                                                    commercial, IP and medical advantages. There are
   publications. Ms Yost holds a MSc        In itself, DR is certainly not new. Companies have      numerous companies in this space, including some
 from the University of Birmingham          long been expanding their drugs’ indications, adding    generics firms, who focus on technology platforms
     and has research experience in
                      cancer genetics.      line extensions for various patient populations and     that offer broad application potential.

10                                                                                                                                    DRUG DISCOVERY 2006
                                                                                             Drug Repositioning

Table 1: Selected Drug Repositioning Deals

Buyer                Seller             Asset(s)                            Date                         Deal Value

Pfizer               Nektar             Exubera (inhaled insulin)           Jan ‘06          US$1 billion buy-out of
                     (Sanofi-Aventis)                                                                 Sanofi’s rights
Espirit Pharma       DepoMed            Reformulated off-patent drug        July ‘05          US$50 million upfront
                                        (ciprofloxacin)                                           15–25% royalties
Novartis             Arakis, Ventura    Reformulated off-patent drug        May ‘05           US$30 million upfront
                                        (glycopyrrolate)                                    Up to US$375 million in
Sosei                KineMedi           Screening Soesi compounds           April ‘05                  Not disclosed
ICICI Venture Fund   Dr Reddy           ANDAs for reformulated              March ‘05         US$25 million upfront
                                        compounds                                            Up to US$35 million in
                                                                                                            Phase II
Endo Pharamceuticals ProEthic           Topical formulation of ketoprofen   March ‘05         US$10 million upfront
                     Pharmaceuticals                                                      US$14million in milestones
Arachanova           Mitsubishi         New use for MCI 225                 March ‘04                  Not disclosed
                     Pharma Corp.
Forest Laboratories Cypress             Milnacipran for firbromyalgia       January ‘04       US$25 million upfront
                     Biosciences                                                            Up to US$250 million in

Most DR companies are either focused in a specific          Old Drugs, New Tricks?
therapeutic area, or on exploiting a particular
technological system to identify or develop new DR          For companies looking at the DR route, the risks are
opportunities. Such a degree of specialisation is           lower and so are the costs in terms of money and
usually an important differentiator. A list of some         development time compared with developing new
DR companies and their therapeutic areas of
expertise is provided in Table 2.

Deal Flow

Growing demand for DR opportunities can be
evidenced by a number of recent deals in the area
(see Table 1). Many types of companies, including
big pharma, are looking for new formulations of
existing drugs, new uses for old drugs and the
                                                                              innovatively with
associated faster development times for such
products. It is now estimated that a new drug can                                innovation
cost as much as US$1.7 billion to develop, and takes
10–12 years to reach the market – with a high
percentage of drugs failing during clinical trials.
This makes the DR approach even more appealing.

The DR approach can provide the basis for new
intellectual property (IP) and thereby help to
extend the patent life of existing drugs that have
lost, or soon will lose, patent protection. Between
2002 and 2007, 35 patents have expired or will
expire on key drugs worth US$73 billion. By 2010,
300 patents will have expired. Generic versions of
high-selling drugs will be ready and waiting to
launch the day each patent expires. If we look at
drug approvals, we can see that approvals for new
drugs are not increasing year on year, whereas the
number of generic drug approvals has soared
(see Figure 1 and 2).                                                                                       www.hlbbshaw.com
                                                                                                            telephone: 01992 561756

                                                  Research & Development Strategies

Figure 1: New Drug Approvals, 1993–2005                                                                                                               starting to dispel the notion that repositioning is simply
                                                                                                                                                      a rehashing of old drugs. Many speciality pharma firms
 60                                                                                                                                                   with DR technologies are working with big pharma,
 50                                                           35                                                                                      who are willing to pay for their services. There are not
                                                                                                                                                      yet any examples of marketed products from ‘pure’
 40                                                                                                                                                   drug repositioning companies. Nevertheless there is a
                                                                                          16                                                          growing number of products on the market that have
 30                                                                                14
                                                 19                                                                                   15
                             12                                                                    18      17
                                                                                                                                                      used a repositioning angle. These include new
 20                                     9                                                                                       12    21        5
                                                              18                          19                       10
                                                                                                                                                      indications or new formulations for products still under
                                                                                   16                                                          15
 10                          13        12                                                                                                             patent protection, new therapeutic uses for off-patent
                                                 10                    9                           9                            9
                                                                                                              7    7                                  drugs and new uses for ‘failed’ compounds. Growth in
                            1993      1994      1995        1996     1997          1998   1999    2000   2001     2002         2003   2004     2005   DR is likely to continue as the key drivers for the
                                   Priority NME Approvals               Standard NME Approvals            Number of NMEs Filed                        industry to work in this area gain momentum.

Source: The RPM Report, Feb 2006.                                                                                                                     There are several examples of marketed drugs that
                                                                                                                                                      exemplify the repositioning concept, only a few of
Figure 2: Generic Drug Approvals, 1999–2005                                                                                                           which are described below. In terms of new indication
                                                                                                                                                      examples, Merck’s finasteride, a 5-alpha-reductase
                                                                                                                                       106            inhibitor, was originally launched as Proscar in 1992 as
                            400                                                                                          93
                                                                                                                                                      a treatment for benign prostatic hyperplasia (BPH).
                            350                                                            68            89                            361
                                                                                                                                                      The drug was discovered to have the side effect of
                                                                                                                                                      preventing male pattern baldness, and was launched as
   Number of Applications

                            300                                             69                                           320
                                                         62                                296
                            250         68
                                                                                                         284                                          Propecia for the treatment of hair loss in 1997. Pfizer’s
                                                         232                241                                                                       minoxidil (Rogaine) was first used as an oral
                                                                                                                                                      hypertensive. Clinical observations that it stimulated
                                                                                                                                                      hair growth resulted in its development as a topical
                                                                                                                                                      treatment for alopecia in both men and women. The
                                                                                                                                                      US Food and Drug Administration (FDA) approved
                                      1999               2000               2001           2002          2003            2004           2005
                                                                                                                                                      Johnson and Johnson’s topiramate for epilepsy in 1996.
                                        Full approvals             Tentative approvals
                                                                                                                                                      Because the drug has numerous effects on the central
Source: The RPM Report, Feb 2006                                                                                                                      nervous (CNS) it was proposed and tested for the
                                                                                                                                                      preventative management of chronic migraine. In
Table 2: Profiles of Selected DR Companies                                                                                                            2004, the FDA approved topromirate for the
                                                                                                                                                      prophylaxis of migraine in adults. Finally, buproprion
Company                                                     Sourcing Strategy                                              Therapeutic Focus          is a weak norepinephrine/dopamine reuptake inhibitor
Arachanova                                                  SwitchBase technology to discover     Predominantly central                               that was first marketed by GlaxoSmithKline for
                                                            new indications                       nervous system (CNS)                                depression as Wellbutrin. In 1997, the compound was
Arakis                                                      Literature searching                           Inflammation                               approved for use as a smoking cessation aid.
Aspreva                                                     Literature searching                           Rare diseases                              GlaxoSmithKline rebranded this product as Zyban.
BTG                                                         Multi-dimensional sourcing approaches               Multiple
CombinatoRx                                                 Combination drug screening                         Oncology,                              Many examples also exist where drug formulation
                                                                                                           inflammation                               and/or delivery technologies were applied to specific
Cypress Biosciences                                         Literature searching                                    CNS                               drugs to create new DR products. One such example
Dynogen                                                     Management expertise                    Gastrointestinal (GI)                             is Shire’s Carbatrol® controlled release for the
GeneLogic                                                   Genomics                                   Technology focus                               treatment of epilepsy and bipolar disorder. This
Hypnion                                                     In vitro screening                           Sleep disorders                              product, which received FDA approval in 1998,
KineMed                                                     Screening abandoned clinical             Metabolic diseases                               differentiated itself from the original immediate
                                                            compounds                                                                                 release product, Tegetrol®, as BID dosing compared
Nektar                                                      Drug delivery                            Metabolic diseases                               with QID dosing with an improved label via
Somaxon                                                     Management expertise                                    CNS                               elimination of food effects and option for
Sosei                                                       Compound libraries from Japanese companies                 GI                             administration as a sprinkle for those patients who
Vectura                                                     Reformulation of existing drugs                         CNS                               can not ingest an intact dosage form. Carbatrol
                                                                                                                                                      achieved US$50+ million in sales in its fifth year
                                                                   drugs. Pharma companies are now looking at DR                                      following launch into a genericised market. ■
                                                                   opportunities alongside their innovative new drugs in
                                                                   order to balance their pipelines with respect to risk and                          A longer version of this article can be found in the Reference
                                                                   launch times. The emergence of focused DR                                          Section on the website supporting this briefing
                                                                   companies with advanced technology platforms is                                    (www.touchbriefings.com).

12                                                                                                                                                                                      DRUG DISCOVERY 2006

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