It turns out that Novalar Pharmaceuticals’ decision to sell OraVerse, its dental anesthesia reversal agent, was only half the story.

Novalar CEO Donna Janson tells The San Diego Union-Tribune today that the venture-backed company has no other drug candidates in its pipeline and will soon shut down. The Union-Tribune says the company plans to lay off its remaining 12 employees in coming weeks. The company’s website yesterday included information about another drug that Novalar had licensed in 2007, but that information was not available on Novalar’s website today.

Novalar made no mention of the shutdown in its statement yesterday. Janson was not immediately available for comment by e-mail or telephone this afternoon.

Novalar sold OraVerse to Septodont, a privately owned company based in St. Maur, France, (and not Lancaster, PA, as I reported) for an undisclosed payment “to Novalar and its investors.” In comments to the U-T today, Janson indicates that Septodont’s upfront payment, along with milestone payments and royalties from OraVerse sales, would be going to Novalar’s investors. She told the newspaper that selling OraVerse provided “the most lucrative return for our investors.”

Novalar’s venture investors include Domain Associates, Boston Millennia Partners, Genevest, Montreux Equity Partners, New Enterprise Associates, SR One, and Sears Capital Management.

Comments | Reprints | Share:          

In an unexpected development, San Diego’s Novalar Pharmaceuticals says today it has sold OraVerse, its dental anesthesia reversal agent and only FDA-approved product, to Lancaster, PA-based Septodont, a leading supplier of dental anesthetics.

The big question arising from the sale is what’s next for Novalar? OraVerse has been the main focus of the company’s business activities since Domain Associates partner Eckard Weber got the idea while talking about the lingering effects of dental anesthetics during a dental exam. Weber, an M.D., pharmacologist, and venture capitalist, founded Novalar in 2000. He recruited CEO Donna Janson from Europe to run the company.

In a statement from the companies, Septodont will pay Novalar and its investors an upfront payment for OraVerse, and will pay milestones and royalties on product sales. No specific numbers were disclosed.

At one time, Novalar was talking about creating a $300 million to $400 million market for Oraverse in the United States. But at this time last year, it was clear that OraVerse sales were slower than Novalar had planned. Septodont, a 75-year-old company that provides anesthetics for 500 million injections a year around the world, can take advantage of its well-established sales and distribution network in North America and international markets where Novalar has no partnerships. Novalar signed an exclusive license and distribution deal in Germany for OraVerse with Sanofi-Aventis Deutschland GmbH.

Novalar has raised at least $43 million in venture capital. Its investors include Boston Millennia Partners, Domain Associates, Genevest, Montreux Equity Partners, New Enterprise Associates, SR One, and Sears Capital Management.

So what’s next for Novalar?

The company’s website describes another dental product in its pipeline. Novalar licensed the patent rights for a novel endodontic therapy (designated NV-201) in 2007 for a polymer fiber that delivers an antibiotic directly into the root canal. With 17 million root canal procedures performed in the United States, Novalar sees an opportunity in developing a new technique for using clindamycin, a common dental antibiotic, to keep bacteria at bay between root canal visits.

The company adds that it is continually “searching for new dental technologies to license to bolster our product pipeline.”

Comments | Reprints | Share:          

Getting a shot of anesthesia at the dentist’s office is not most people’s idea of fun. Once that’s over, the cavity gets filled, or gums get power-cleaned, then patients usually have the dubious pleasure of waiting five or six hours with a numb mouth that’s not much good for talking or drinking. If you aren’t careful, it just might cause you to accidentally bite your own lip.

Of course, the numbness eventually wears off. But if you’re not the kind of person who wants to wait for your sense of feeling to return, San Diego-based Novalar has come up with a drug to make that happen in half the time. It’s an opportunity that could be worth as much as $500 million a year by 2015 in this cosmetic-dentistry loving nation. The company’s market research says almost two-thirds of all dental consumers were “very or somewhat uncomfortable” with lack of sensation when leaving the dentist’s office.

“Over the last 10 to 15 years, we’ve seen quite a shift in how patients seek out dental care,” says Donna Janson, Novalar’s CEO. “It used to be you’d go because something was hurt or broken. Now you have people seeking aesthetic dentistry, adults seeing orthodontists.” She added that there’s a rise in “dental spas” where they provide all sorts of creature comforts, like an iPod, movies, blankets, all to “improve the patient experience.”

Novalar is aiming to tap into this trend with phentolamine mesylate (Oraverse). It’s pretty simple. Most dental anesthesia uses a vasoconstrictor, which limits blood flow to the tissues in the mouth around the teeth. The Novalar drug is a vasodilator, which allows the blood flow to return to the gums, lips and cheeks.

The company got started in 2000, when Eckard Weber of Domain Associates worked on a project to see if this vasodilator could be turned from a powder form into a low-dose, stable liquid injection which could be used to reverse lingering anesthesia. It worked, passed a clinical trial in 418 patients, and was approved by the FDA in May. The drug reduced the median time to recovery of normal sensation in the lower lip by 85 minutes compared with those in a control group.

The product is sold in a cartridge that fits into a standard dental syringe, and is injected while the patient’s mouth is already numb, Janson says. It plans to sell the cartridge for about $12.50 a shot.

I have to admit I was a bit incredulous that anybody would pay for this, but Janson assured me, the company has already thought about that. They aren’t looking for insurance coverage, at least in the beginning. Customers these days are accustomed to pay for a lot of dentistry out of their own pockets. In a survey of dentists, about one-third said they’d offer the anesthesia-reversal service without passing on the extra cost to customers, one-third said they’d tack it on to the cost of the procedure, and one-third said they’d use it as a marketing tool and make a profit on offering the feature, Janson says.

Novalar has hit one bump in the road this year. When it got FDA approval, it planned to introduce the product at the American Dental Association’s meeting in October in San Antonio. They missed that deadline after it had a packaging problem that didn’t meet quality standards, Janson says. Now it plans to introduce the drug at a dental meeting in Chicago in February.

Novalar doesn’t have any direct competitors in this market, so it’s preparing as if the opportunity is its for the taking. The company has 30 employees now, up from just nine a year ago. It is hiring aggressively, building its staff to 55 by year-end, and close to 100 by August, many of them in sales jobs. The product will be rolled out regionally in places that demand cosmetic dentistry, like urban areas of California, Illinois, Florida, New York, Texas, and Baltimore, Janson says.

Novalar has another drug in its pipeline that might offer more of a medical benefit. It’s an antibiotic-coated polymer fiber, which a dentist would stick inside a hollowed-out tooth after performing a root canal. This is meant to prevent bacterial infections during the weeklong lag time between the first and second steps of the procedure. This would provide a localized bug-killer, instead of putting people on oral antibiotics that circulate throughout the body. Oral antibiotics have a tough time infiltrating the tooth where the drug is needed because much of the blood vessels that supply it are dead.

That sounds to me like the kind of product that could generate sales, even in an economic downturn. But it’s still probably five years away from the market, Novalar says. We’ll see in the coming year if people still are willing to pay a little extra for a drug that gets rid of the numbness in the mouth a little faster than Mother Nature does already.

Comments (1) | Reprints | Share: