[Corrected 5/7/12, 5:10 pm. See below.] When Yuichi Iwaki started MediciNova in 2000, he says many mid-size pharmaceutical companies in Japan had concluded it was just too difficult to conduct their own clinical trials in the United States. So MediciNova was born of a kind of Japanese pragmatism.
“Mid-size Japanese companies did not have the financial resources,” Iwaki tells me. “If they have compound, they did not know how to do business in the U.S. That’s the reason I was able to in-license tremendous compounds for minimal payment.”
In the 12 years since MediciNova set down its roots in San Diego, the biopharmaceutical startup has licensed eight compounds (seven from Japanese pharmas and one from the U.K.), raised more than $280 million, and become a public company (NASDAQ: MNOV), with trading on the Nasdaq global market and Japan’s Osaka Securities Exchange.
“In the past seven and a half years, we’ve spent $270 million to get to this level,” says Iwaki, who also is a professor at the University of Southern California School of Medicine and director of USC’s Transplantation Immunology and Immunogenetic Laboratory. “It’s not an easy path, but we believe we are getting closer to the goal.”
Iwaki, a Japanese-trained surgeon who came to the United States in the 1980s, is particularly hopeful about MediciNova’s lead drug candidate, bedoradrine sulfate, a compound licensed from Japan’s Kissei Pharmaceutical for use in the United States as an intravenous treatment for treating acute asthma attacks.
MediciNova says its drug has a key advantage over the current standard of care in U.S. emergency rooms, which typically use an inhaled drug like albuterol. An asthma patient’s constricted airways can limit the effectiveness of aerosol drugs, which creates some uncertainty over how much of a given drug has been absorbed. Because bedoradrine is delivered intravenously, MediciNova says, ER doctors know exactly how much of the drug has been administered. The company is nearing completion of a mid-stage trial of 176 patients in more than 20 U.S. hospitals (including UC San Diego and UCLA).
The firm says it plans to release results of its mid-stage trial by June 30, and Iwaki voices confidence about moving to late-stage trials sometime next year.
[Corrects to show the drug was in clinical trials, not approved, as a uterine muscle relaxant] In Japan, the drug was in clinical trials as a uterine muscle relaxant for women in pre-term labor. Medicinova initially considered seeking FDA approval for treating pre-term labor in the United States. But Iwaki says the company decided instead to seek regulatory approval for treating acute asthma episodes after the FDA said it would require additional testing of pregnant women that could add up to four years to the drug development timeline. “More than the [additional] costs, we were concerned about the timelines,” Iwaki says.
In researching the market potential for treating asthma, however, MediciNova found there are 20 million people in the United States with asthma, according to Mark Johnson, MediciNova’s director of investor relations and corporate development. Acute asthma episodes are unpredictable and result in some 1.9 million ER visits throughout the U.S. every year. In roughly one out of four of those visits, Johnson says, the patient is hospitalized at an average cost of nearly $6,500.
MediciNova says bedoradrine, if approved, could potentially reduce hospital admissions of asthma patients by 20 percent to 50 percent a year—which would save millions of dollars in reimbursement costs, says Michael Coffee, MediciNova’s chief business officer. “We’re [ostensibly] competing with albuterol,” Coffee says. “But what we’re really competing against is the cost of hospitalization when albuterol isn’t enough.”
The company believes bedoradrine also would be an effective therapy for treating acute exacerbations of chronic obstructive pulmonary disease (COPD). Patients show similar symptoms to asthmatics, but are generally more ill, with higher hospitalizations and mortality. The company says it also expects to report preliminary results of an early stage “safety and tolerability” trial with 20 COPD patients during the second quarter.
With MediciNova’s stock trading today around $3.45 a share, the company has a market valuation of more than $55 million. Coffee says he expects the company’s burn rate will drop in a couple of months to about $2 million a quarter (from about $4 million a quarter during the mid-stage trials). The company has no debt and sufficient cash to continue into 2013, when late-stage trials are expected to begin.
Iwaki says MediciNova’s strategy is to market its lead compound in the United States, and to reach a partnership agreement for development in Europe, where COPD is associated with higher rates of smoking in some areas. The company already has announced a joint venture to commercialize bedoradrine in China.
[Corrects to show company hopes to work with a partner.] The company says it also hopes to work with a partner to advance the next drug in its pipeline, ibudilast, an oral drug that MediciNova has licensed for development in the United States as a treatment for multiple sclerosis, neuropathic pain, and drug addiction. With just 15 employees (12 in San Diego and three in Japan), however, MediciNova’s resources are limited.
“As far as where we’re focused, right now we have to be maniacally focused on the [bedoradrine] market opportunity for asthma,” Coffee says. Iwaki adds that 2012 should be a transformative year for MediciNova, saying, “We have a lot of exciting momentum.”
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