Who says the FDA isn’t open to new ideas? The U.S. drug agency has given the green-light to GTC Biotherapeutics, a small biotech company in Framingham, MA, to market the first drug in the U.S. ever derived from genetically modified animals.

GTC Biotherapeutics (NASDAQ: GTCB) and partner Ovation Pharmaceuticals of Deerfield, IL, said today that the U.S. drug regulator has given them clearance to begin selling recombinant antithrombin (ATryn) to patients in the U.S. with a rare, genetic blood clotting disorder. The companies expect to introduce the drug to the market before the end of June.

The FDA’s decision comes as little surprise, since a report released last month showed that the agency’s staff considered the drug to be safe and effective, and an outside panel of FDA advisers agreed. This product has generated little in the way of sales for GTC in Europe, where it is currently approved. But more importantly, GTC hopes that the FDA’s decision establishes a clear path for approval of other products made a similar way.

In the case of this drug, a goat is genetically modified to produce more than the usual amount of antithrombin protein, which is secreted through its milk. The proteins are then filtered out from all the other material in goat milk that you wouldn’t want to inject into a person, sort of like how other biotech drugs are purified from fermentation-type techniques. The business attraction of GTC’s method, sometimes called “pharming,” is that it can pump out industrial quantities of protein drugs more cheaply.

“The approval of ATryn marks a significant milestone in the development of this innovative recombinant technology,” said Geoffrey Cox, CEO of GTC Biotherapeutics, in a statement.

The drug’s formal approval covers patients who have a gene mutation that creates a deficiency of antithrombin protein, making them more likely to develop dangerous blood clots. An estimated one out of every 2,000 to 5,000 people in the U.S. has the disorder, GTC says.

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The first drug ever manufactured in genetically-modified animals is likely coming soon to the U.S. market. A panel of expert advisers to the FDA said today that an experimental anti-clotting product developed by Framingham, MA-based GTC Biotherapeutics looks safe and effective enough to become a marketed product.

The advisers essentially agreed with the conclusions reached by FDA staff, based on documents that were made publicly available Wednesday morning. The FDA still hasn’t made a final decision; its deadline for doing so is Feb. 7.

The product in question, a human protein called antithrombin, is isolated from the milk of goats who have been genetically modified to produce copious amounts of the protein. The drug, marketed as ATryn, has been cleared for sale in Europe since 2006. It hasn’t been a financial boon for GTC, but the company hopes that winning this FDA panel blessing will set a precedent that its manufacturing method, sometimes called “pharming,” can be used for other, more profitable medicines. GTC has signed a partnership with Deerfield, IL-based Ovation Pharmaceuticals who will now gear up in hopes of marketing the drug.

“We are very pleased with the Advisory Committee’s recommendation,” said Geoffrey Cox, CEO of GTC Biotherapeutics, in a statement after the panel’s recommendation.

Pharming’s appeal, as David Stipp wrote for us back in February, comes from its ability to churn out large quantities of protein drugs in a cheap way. Scientists already know how to make genetically engineered protein drugs through fermentation-style techniques using standard lab organisms like E. coli, yeast, or hamster cells, although these methods are more costly and time-consuming than milking a goat.

GTC was able to successfully point out that all protein drugs have to go through a rigorous purification process to separate the drug from all the gunk it brews with. Since they proved the end product is pure and consistent, who cares if it came from a modified goat?

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Would you take a drug made from the milk of a genetically modified goat? A committee of expert advisers to the FDA will take a swing at that question, weighing the safety and effectiveness of such a treatment on Friday. The U.S. drug regulator is seeking advice on whether to approve an application from Framingham, MA-based GTC Biotherapeutics, a company aiming to prove that the drug it makes in goats, an anti-clotting agent, should be the first transgenic- animal-derived drug cleared for sale in the U.S.

Given the ultra-cautious tone the FDA is often accused by companies of taking toward new medicines, GTC’s recombinant antithrombin, a protein drug marketed as ATryn in Europe, sounds like a non-starter here, right? Nope. “The safety profile appears to be acceptable,” FDA staff said, and “ATryn at the recommended dose is effective” in patients with a hereditary deficiency of the anti-clotting protein, according to briefing materials posted online this morning, in preparation for Friday’s meeting of the Blood Products Advisory Committee in Rockville, MD.

Driving home these points in a persuasive way to the advisory panel will be critical for GTC (NASDAQ: GTCB) as a company. It is holding on by the thinnest of threads, with its stock closing yesterday at 57 cents. ATryn, approved in Europe in 2006, is sold there for a rare hereditary disorder that causes clotting. But the drug hasn’t generated nearly enough sales to sustain GTC, so its hopes are riding on U.S. approval. If GTC can get this drug through the FDA, it would also clear the path for other companies that hope to use transgenic farm animals as drug factories, a process sometimes referred to as “pharming.” (In fact Pharming is the name of one such company, a Dutch firm.)

So why on earth would anybody want to make drugs this way? Don’t scientists already know how to make genetically engineered protein drugs through fermentation-style techniques using standard lab organisms like E. coli, yeast, or hamster cells?

As David Stipp described it for us in a feature back in February, pharming’s appeal comes from its ability to churn out large quantities of protein drugs in a cheap way. And GTC makes the point that all protein drugs have to go through a rigorous purification process to separate the drug from all the gunk it brews with. As long as GTC can prove its end product is pure and consistent, who cares if it came from a goat udder?

We’ll see if the FDA panel agrees when it hands down a recommendation on Friday afternoon. The FDA isn’t required to follow the recommendations of its panels, although it usually does. The agency’s deadline for deciding whether or not to apporve the GTC drug is Feb. 7.

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GTC Biotherapeutics is gearing up to take its first “pharming” product, a drug harvested from genetically modified goats, to the U.S. market. The Framingham, MA-based company said today it signed an exclusive partnership with Ovation Pharmaceuticals to develop and market ATryn in the United States. Currently, ATryn is only sold in Europe.

GTC stands to collect as much as $257 million in payments from Ovation if it can meet certain clinical, regulatory, and sales goals, with extra potential cash flow from royalties on product sales, according to the company’s statement. Ovation, a privately-held drug company based in Deerfield, IL., has 14 marketed products for neurological disorders, hematology/oncology, and hospital use, according to the company’s website. It will pay for GTC’s anticipated clinical trial costs, and handle the marketing.

ATryn is approved in Europe, and marketed there by LEO Pharma, for patients undergoing surgery who also have a rare genetic disorder that makes blood clot. The drug is a genetically engineered form of antithrombin, a protein in the blood with anti-clotting and anti-inflammatory characteristics, GTC said. The really unusual part is it’s manufactured through “pharming,” by separating it from the milk of genetically modified goats.

GTC has already submitted part of its U.S. application to market ATryn, and plans to turn in the rest to the FDA for review before the end of September, the company said in a statement. If the FDA gives it the expedited six-month review the company has requested, the drug could be approved for sale in the U.S. before the end of March.

The opportunity in the U.S., GTC and Ovation, hope, is much bigger than just selling it for a rare hereditary disorder. The companies plan to develop ATryn for patients with resistance to the blood thinner heparin who undergo heart bypass surgery, as well as people with clotting associated with severe sepsis, a deadly inflammatory disease.

The boost from Ovation comes during some lean times for GTC. The company reported a loss of $8.2 million in the first quarter, and said it had $11.7 million in cash and investments left at the end of March. Times will surely get tougher if the FDA says it isn’t ready yet for this brand of “pharming.”

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As a rule, getting a drug on the market turns a biotech startup from a buck bonfire into a cash cow—or at least a cash calf. But rules tend to get broken. Just ask GTC Biotherapeutics. In mid-2006, European drug regulators approved the Framingham, MA-based company’s first medicine, ATryn, a protein for blocking risky blood clots. Trumpets blared: It was the first drug made in bioengineered animals—genetically altered goats on GTC’s famed “pharm” near Charlton, MA, produce the medicine, a human blood protein called antithrombin, in their milk. Pharming’s longstanding promise—the ability to churn out large quantities of protein drugs at relatively low cost—was finally a commercial reality.

But despite making history, GTC was soon pegged by investors as little more than a cash embryo. ATryn, which GTC had licensed to Denmark’s LEO Pharma, was approved to prevent blood clots in patients with a rare, inherited antithrombin deficiency who were undergoing surgery. Annual sales, perhaps only a few tens of millions of dollars, wouldn’t come close to making GTC profitable. Last year the company’s shares drifted under a dollar each, prompting the NASDAQ Stock Market to notify GTC in January that its stock was headed for delisting. Last Friday the company underscored its cash-strapped status by announcing that it had agreed to sell 6.9 million shares to institutional investors at a fire-sale price of 87 cents a piece. Following the announcement, its share price fell below 80 cents.

You’d think all this would get CEO Geoffrey F. Cox’s goat. But when I talked to him last week, he sounded upbeat, reeling off a number of reasons GTC’s stock price isn’t likely to linger in the sub-buck-a-share danger zone for delisting.

First, he noted, GTC is in talks with a “number of parties” interested in partnering with it to commercialize ATryn in the U.S. (GTC said earlier that it hoped to complete the deal by the end of this quarter). “It’s very tough to predict with certainty” that that timing goal will be met, Cox added. “Nothing’s gone wrong—the negotiations are going very well. But these things take time, and I’m anxious to do the right deal rather than do one just to meet a timeline.” GTC’s negotiating position just got a bit stronger—it recently racked up key clinical data for ATryn’s U.S. approval.

A partnership would add sorely needed funds to GTC’s coffers. As of September 30, the company had only about $21.8 million in cash, less than its net loss of $26.5 million for the first nine months of 2007. (The latest stock sale announced Friday brought in some $6 million.) It would also put ATryn on the road to correcting antithrombin deficiencies much more prevalent than the rare, inherited one it’s approved to treat.

One such deficiency sometimes occurs in patients undergoing coronary artery bypass surgeries—potentially a $150 million to $200 million-a-year market, according to Cox. Another is disseminated intravascular coagulation, or DIC, which can cause deadly blood clots in patients with severe infections, an indication GTC sees as potentially a multi-billion-dollar market. LEO Pharma, GTC’s European partner, is conducting a Phase 2 trial with ATryn for DIC patients. “Hopefully LEO will complete patient recruitment over the next year or so,” Cox said. The trial might be followed by a large, international Phase 3 study sponsored by LEO and GTC’s to-be-announced U.S. partner, speeding ATryn’s approval for DIC in both Europe and the U.S..

GTC also plans to produce a protein called factor VIIa, used to treat hemophilia. Currently extracted …Next Page »

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GTC Biotherapeutics (NASDAQ: GTCB), which bioengineers goats to secrete drugs in their milk, announced late yesterday that its groundbreaking medicine for a rare blood-clotting disorder cleared the main hurdle in a pivotal U.S. trial. The advance paves the way for the Framingham, MA-based company to seek FDA approval for the drug around mid-year, potentially making it the first medicine from “pharming”—manufacturing drugs in bioengineered animals and plants—to reach the U.S. market.

In 2006, the drug ATryn was approved in Europe to treat the same clotting disorder, making it the first pharmed medicine to garner regulatory endorsement. GTC’s European partner, France’s LEO Pharma A/S, launched ATryn last year in the U.K. to treat the rare condition, hereditary antithrombin deficiency, or HD, in patients undergoing high-risk surgical procedures.

GTC’s clinical-trial news was expected and had little impact on its stock price—GTC was trading at $1.06, up 4 cents a share, soon after the market opened this morning. The company’s shares have languished under a dollar in recent months, prompting the Nasdaq last month to notify GTC that its stock might be delisted. It hasn’t helped GTC’s stock price that the market for the rare clotting disorder is very small. In fact, the U.S. trial required only 31 patients.

But if GTC succeeds in getting FDA approval for ATryn, which may occur near the end of 2008, the regulatory path for pharmed drugs will have been blazed, potentially facilitating FDA approval of ATryn for more prevalent disorders and opening the door for other pharmed drugs. GTC and other pharming startups have long dreamed of revolutionizing biotech manufacturing by mass-producing protein drugs in goats and other animals whose DNA is implanted with human genes.

The clinical advance is also expected to clear the way for GTC to form a partnership to commercialize ATryn in the U.S. The company earlier said it plans to conclude a partnership agreement during this year’s first quarter—stay tuned.

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