San Diego’s Palkion Chases Amgen’s Big Market, Joins Race to Develop Oral Anemia Drug
Amgen’s big break came in the 1980s when it learned how to stimulate the body to make more oxygen-carrying red blood cells. Nobody has topped this achievement for the treatment of anemia in the past 20 years. But now San Diego’s Palkion has joined a list of competitors that hope to capture some billions of their own with a more convenient oral pill that aims to do the same thing as Amgen’s injection.
Palkion crossed my radar screen a couple weeks ago when it raised $2.5 million, which brings its total financing to about $11 million since it was founded in February 2008. The company, backed by ProQuest Investments, hasn’t said a whole lot publicly about what they’re up to, so I tracked down CEO Wendy Johnson, who’s also a ProQuest venture partner, for an update.
One reason it got the money is the scientific approach, but mostly it’s about market opportunity. The anemia drug business is so big that the industry leader, Thousand Oaks, CA-based Amgen (NASDAQ: AMGN) lost $29 billion in stock market value in 2007 after its two anemia drugs were tied to higher risk of heart attack, stroke, and death when used at high doses. The worldwide market for anemia drugs generates $11.5 billion in sales each year, for patients with various states of kidney disease, and cancer patients who get anemic from chemotherapy.
Those drugs are genetically engineered copies of proteins that stimulate red blood cells, and must be given by injection. Many companies—notably San Francisco-based FibroGen, GlaxoSmithKline, Merck, and even Amgen—have been pursuing another doorway of biology to accomplish the same goal. Companies pursuing this approach are making conventional oral drugs that interfere with enzymes known as HIF prolyl hydroxylases. By blocking those enzymes, the body should regain its natural ability to produce enough red blood cells to correct anemia, Johnson says.
“Fibrogen is clearly the leader,” in the new method of treating anemia, Johnson says. “But I don’t mind a little competition. We consider ourselves a fast follower.”
So what does Palkion have that’s special? It all sounds like it’s too early to make any bold proclamations. The company was started via a partnership with Korea-based CrystalGenomics, to take advantage of its expertise in using crystal structures to select new drug candidates with ideal properties. That work has been productive, Johnson says, prompting Palkion to select a lead candidate. The lead candidate has shown an ability to achieve the kind of red blood cell production scientists like to see in both rodents and primates, she says.
Palkion hopes to raise more capital to keep going ahead with the necessary toxicology tests that it will need before it can push its candidate into human clinical trials. If it can get to that point, it plans to position the drug for patients with less severe forms of kidney disease that don’t require dialysis—one of Amgen’s core markets. The company will have to clear a high hurdle with safety, since the FDA issued well-publicized warnings a couple years ago to physicians about the risks of boosting red blood cells too much.
Although Johnson cautions that “this is a complex field of biology,” she’s hopeful that the Palkion drug will offer an attractive alternative to the usual anemia drugs. The product should be different, because it should provide a slow, steady increase in red blood cell levels over about a month, she says. It will allow patients to avoid taking iron supplements they typically need with the Amgen drugs, and the oral dosing may make it easier keep patients’ red blood cells scores on an even keel,
That’s the idea, anyway. Of course, if this were easy, somebody probably would have done it already, especially with billions of dollars going to the winner. Johnson didn’t try to hype the Palkion concept, and mostly made it sound like it was worth taking a shot. FibroGen and another aspiring anemia drugmaker, Palo Alto, CA-based Affymax, have secured significant partnerships after producing promising results from relatively early-stage clinical trials, Johnson says.
“One of the nice things is that you can come to a negative answer or a positive answer fairly quickly,” Johnson says. “It doesn’t require an enormous investment.”