Biotechnology start-ups have long been seen as fearless innovators, embracing experimental technologies, like gene therapy, that big pharmaceutical companies won’t touch. But the news flow from San Diego this summer suggests the industry may have become a bit more cautious. More and more companies, it seems, are focused on reviving or repurposing older drugs – and avoiding the risks of inventing a medicine entirely from scratch.
Take Cadence Pharmaceuticals, (NASDAQ: CADX) which is developing an intravenous pain reliever containing acetaminophen, the active ingredient found in Tylenol. Another San Diego company, Somaxon Pharmaceuticals (NASDAQ: SOMX), is working on a sleeping pill that contains the old antidepressant drug doxepin.
Then there is Avanir Pharmaceuticals (NASDAQ: AVNR), located just across the San Diego border in the Orange County community of Aliso Viejo. It hopes to market a tablet for a side effect of ALS and Parkinson’s disease that contains two existing drugs – dextromethorphan, an ingredient in over-the-counter cough medication, and quinidine, an old drug for treating irregular heart rhythms.
Working on existing drugs has some obvious advantages. Because the drugs have already been approved, companies have access to mounds of data to guide their development programs. In some cases, they may be able to forgo some pre-clinical tests or even clinical tests.
“You are dealing with known chemical entities. So from a baseline perspective, you are ahead of the curve. You do have a sense of how the compounds work, and a large amount of data,” Avanir CEO Keith Katkin tells me.
Getting a running start in this way can save start-ups many thousands or millions of dollars in research and development costs—and reduce the risk of failure. It’s a compelling strategy, particularly in an economy that has been brutal for more traditional biotechs. Over the last few months, we’ve seen La Jolla Pharmaceuticals (NASDAQ: LJPC) wind down its operations, and TorreyPines Therapeutics (NASDAQ: TPTX) announce a merger agreement to avoid a similar fate. The troubles aren’t confined to San Diego; to the north in Seattle, gene therapy pioneer Targeted Genetics (NASDAQ: TGEN) is fighting for survival.
But if the chances of losing big are lower, so are the odds of winning big.
A recycled drug isn’t likely to become a multibillion-dollar blockbuster like Genentech’s Avastin, a cancer medicine invented entirely in-house. That said, few drugs are as successful as Avastin. And the revenue potential of some reformulated drugs isn’t shabby; some analysts think Cadence’s intravenous acetaminophen could bring in $500 million a year.
So retooled drugs may become successful products – but are they innovative ones? It’s an important question to Xconomy, and I asked it of Eckard Weber, a venture capitalist at Domain Associates in San Diego. Weber, a former professor of pharmacy at UC Irvine and a prolific inventor, takes a broad view.
“There are different manifestations of innovation. A new use of a drug used for something else is one form, and developing new molecules for an old disease is another form,” he said. “It all has a place in the advancement of treating disease and furthering medicine. I don’t know that one is more innovative than the other.”
The process of repositioning an existing drug is not as easy as it sounds, according to Weber. He found the lead candidate for one of his companies by doing a literature search, but it took several years for San Diego-based Novalar to reformulate the blood-pressure drug phentolamine into a form dentists could use. The drug, called OraVerse, is approved to reverse the effects of local anesthesia after dental treatment. Dental anesthetics contain a drug that constricts blood vessels to prolong the numbing sensation. Phentolamine reverses that effect by dilating the vessels.
Developing a drug is never risk-free. Avanir, for example, has spent years reformulating and testing different versions of its tablet to satisfy FDA safety concerns. And companies working with existing drugs face the possibility of generic competition. BiDil, a much-anticipated heart drug approved for treatment in African Americans, was a combination of two cheap generics, isosorbide and hydralazine. The tablet flopped, and its developer, Lexington, Mass.-based NitroMed, stopped promoting it in 2008. NitroMed agreed to sell itself to a health care investment firm earlier this year.
Katkin believes Avanir can avoid a similar fate because its tablet contains a very low dose of quinidine that is not available in generic form. Novalar is selling ready-to-use phentolamine; generic phentolamine is freeze-dried and must be mixed with water before it can be used. “You want to be very careful that your formulation is not easily recreated,” Katkin said.
No company can guard against the unexpected. Just ask San Diego’s Victory Pharmaceuticals. The venture-backed company focused on reviving old drugs saw a merger deal blow up after an FDA advisory panel recommended an outright ban on prescription drugs that combine acetaminophen and a narcotic. The panel was concerned about overdoses, and possible liver damage. Unfortunately for Victory, its best-selling drug combines acetaminophen and hydrocodone. Concerns raised by the FDA advisory panel about excessive use of acetaminophen also triggered questions—at least in some quarters—about the prospects of the intravenous acetaminophen under development at Cadence Pharmaceuticals, although the company says it’s not worried.
If there’s a lesson to be learned, it may be that repurposing old drugs may not be such a low-risk path for drug development after all.
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