2014 Pipeline Report: The Sprint to Value - Pharmaceutical Executive


2014 Pipeline Report: The Sprint to Value

Pharmaceutical Executive

Novel Antibiotics: HHS Begs for New Treatments

Most large pharmaceutical companies haven't rushed to develop new superbug-swatting antibiotics or anti-infectives, despite a dire need for such products. That's because historically, antibiotic R&D programs are often long and expensive, without much of a financial upside on the other end; prices have been pushed down by generics, and the course of therapy is short. The pricing problem could change; in September, the CDC announced that some 23,000 people in the United States die from antibiotic-resistant bacteria each year, and at least 2 million are infected. "There's a very direct correlation between superbugs and incredibly high hospital costs and mortality, says Thong Le, managing director of WRF Capital, the VC arm of the Washington Research Foundation. "A lot of the antibiotics we're using today have been around for 50 years."

Last year's Generating Antibiotic Incentives Now (GAIN) Act, ratified as a provision PDUFA V, is designed to push drug makers back into the antibiotic and anti-infective space. Thanks to the GAIN Act, incentives for companies willing to take up the task of novel antibiotic development include automatic eligibility for Fast Track status and Priority Review, which shortens the FDA review period to six months. Once approved, the antibiotic would be granted an additional five years of market exclusivity.

It's not clear whether that's a strong enough kick to make Big Pharma roll. Last spring, HHS's Biomedical Advanced Research and Development Authority announced a deal with GlaxoSmithKline to provide up to $200 million over five years to develop new antibacterial products. Similar government-financed deals with Big Pharma have been struck in Europe. Meanwhile, a few smaller biotech firms are focusing on the antibiotic-resistant and infectious disease space, and several new products could go to bat against the superbugs next year.

Raghuram Selvaraju at Aegis Capital Corp. says Cubist, with its dual acquisitions of Trius Therapeutics and Optimer Pharmaceuticals in 2013, has positioned itself "in the vanguard of anti-infective drug development." Fast Tracked via the GAIN Act, Trius's tedizolid phosphate, a second-geneartion oxazolidinone antibacterial agent was filed with FDA in October for the treatment of acute bacterial skin and skin structure infections, and is also being tested for the treatment of serious Gram-positive infections, including those caused by methicillin-resistant staphylococcus aureus (MRSA). The drug will compete against Pfizer's Zyvox, with a couple of added benefits, like easier administration and dosing, and slightly fewer side effects. Credit Suisse has modest estimates for tedizolid, $200 million by 2020. A second Cubist product, CXA-201, in Phase III for complicated intra-abdominal infections and complicated urinary tract infections, is expected to file at the end of this year, assuming the Phase III data is strong. Selvaraju thinks CXA-201 will launch in early 2015, and earn $700 million by 2022. That product will face off against meropenem, a broad-spectrum beta lactam antibiotic to which bacteria is growing resistant.

The best targets for infectious disease, from a financial perspective, are community-acquired pneumonia and complicated skin and skin structure infections (CSSSI), says Selvaraju. "We like CSSSI because the clinical trial design is pretty straight forward, compared with a lot of other indications," says Selvaraju. "We like community-acquired pneumonia lung infections because there are comparatively fewer solutions for that currently available."

Selvaraju says Cempra's solithromycin, a Phase III product targeting community-acquired pneumonia, shows promise. In September, Cempra reported in vivo data showing that solithromycin is active against a broad range of pathogens, including four of FDA's Qualified Infectious Disease Pathogens under the GAIN Act.

For the moment, pharma doesn't seem to be answering Janet Woodcock's increasingly frantic calls for new novel antibiotics. Many small companies, including Cellceutix, Durata, Anacor, and others are moving through clinical trials and targeting serious bacterial infections, but more work is needed to better understand the complex biology of the superbugs, and to take them down.


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