San Diego-based Zogenix (NASDAQ: ZGNX) has an update today on its development of an extended-release and acetaminophen-free formulation of the painkiller, hydrocodone bitartrate, which the company plans to market as Zohydro oral capsules.

After agreeing on submission requirements for its reformulated drug in a series of meetings with regulators at the FDA, Zogenix says it plans to submit its new drug application for Zohydro by mid-May. The company says it is seeking clearance under a section of the Food and Drug Act that allows a new drug candidate to rely on studies already published in the scientific literature or the FDA’s own finding of safety and effectiveness of a previously approved drug product.

In its statement today, Zogenix says Zohydro is being evaluated for the management of moderate-to-severe chronic pain in patients requiring around-the-clock opioid therapy for an extended period. If approved, Zohydro could be the first extended-release hydrocodone therapy available without acetaminophen, which is associated with an increased risk of liver toxicity when used in high doses over time.

The formulation relies on proprietary extended-release technology that was developed by Alkermes (NASDAQ: ALKS), the drugmaker based in Dublin, Ireland, that Zogenix chose as its chemistry and manufacturing controls (CMC) partner.

If the NDA is approved, Zogenix has said it could begin marketing the drug as early as 2013. The company estimates that more than 128 million prescriptions are written in the U.S. each year for hydrocodone drugs, a potential $7.5 billion market opportunity.

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San Diego-based Zogenix, a specialty pharma that has been selling its first product (a fast-acting migraine drug in a single-dose injector) for 22 months, is getting ready to diversify its portfolio.

As we reported in August, Zogenix successfully completed its late-stage safety and efficacy trials for an extended-release formulation of the painkilling drug hydrocodone bitartrate (Zohydro). Earlier this month, Zogenix executives told me they are doing the final analyses of their clinical findings for the drug, which is intended to provide lasting relief for people with chronic pain. Zogenix says it plans to submit a new drug application (NDA) in early 2012.

If Zogenix wins FDA approval, the company says it could begin marketing for its second product in 2013, calling it the first extended-release painkiller in the hydrocodone class—a drug category that includes acetaminophen/hydrocodone (Vicodin) and acetaminophen/oxycodone (Percocet). Zogenix says its pain-killer also would be the first “single-entity” hydrocodone (i.e. acetaminophen-free), which became a relevant selling point earlier this year, when the FDA announced a limit on how much acetaminophen could be used in combination drugs and required liver toxicity warnings.

With its clinical trials basically completed, Zogenix CEO Roger Hawley says the company plans to meet with FDA regulators in coming weeks in preparation for its NDA submission sometime after January 1. (The company also plans to release its third-quarter earnings on Nov. 10.)

Zogenix has based its core, long-term strategy on its needle-free DosePro technology, which uses pressurized nitrogen gas to drive a liquid jet of a prescribed drug under the skin in less than 1/10th of a second. The FDA cleared the company to sell its first drug-and-device product, the DosePro with a fixed dose of the painkiller sumatriptan, in 2009. Zogenix plans to build its business on a series of similar drug-and-device combinations focused on diseases and disorders of the central nervous system, and could even license its DosePro technology.

The bad news is that each drug-and-device combo will require a separate FDA review. The good news, however, is that each combo is considered unique—and therefore eligible for patent protection. Even if patent protection for a particular drug has expired, Zogenix says it … Next Page »

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Buying, Selling, Agreeing. San Diego’s life sciences companies conducted a lot of different transactions over the past week. We have a rundown for you.

—San Diego’s ResMed, which specializes in medical devices used to treat sleep apnea and related breathing disorders, said it acquired BiancaMed, a private Irish maker of sensor technology used to monitor sleep and breathing. Financial terms were not disclosed, but a ResMed spokeswoman told the U-T the deal represented a significant premium over the $15.8 million that all of BiancaMed’s investors—include ResMed—previously put into the company.

—-The executive chairman of San Diego’s aTyr Pharma, John Mendlein provided an overview of an idea he conceived that would enable nonprofit disease foundations to help fund aTyr’s R&D, along with big government agencies and privately held pharmaceutical and biotech companies.

—ActivX business development executive Robert Hillman alerted me yesterday to just-published findings, which the San Diego-based unit of Japan’s Kyorin Pharmaceutical said validate its KiNatiV technology. Hillman says the technology uses probes that interact and bind with kinases within cells of any tissue from any species, enabling ActivX to use sophisticated mass spectroscopy to identify key attributes of kinases that can’t be obtained any other way. In a statement, the company says, “Given the utility of kinase inhibitors as research tools and promising agents for molecular-targeted therapy, the opportunity to characterize their interactions with native endogenous kinases undoubtedly represents a significant step forward.”

—San Diego’s Cadence Pharmaceuticals (NASDAQ: CADX) got a new headache, after the FDA disclosed that an unidentified competitor wants to bring a generic version of Cadence’s pain reliever to market in the United States. The FDA allowed Cadence to start selling its injectable formulation of acetaminophen to hospitals just nine months ago.

—Life Technologies (NASDAQ: LIFE), the Carlsbad CA-based giant in biomedical diagnostics, settled an intellectual property dispute with Fluidigm (NASDAQ: FLDM), the South San Francisco maker of microfluidic instruments used to identify rare and valuable cells.

—San Diego’s CareFusion (NYSE: CFN) agreed to pay $150 million to acquire Rowa, a German maker of robotics used in pharmacies for the automated high-speed storage and retrieval of pre-packaged pharmaceutical products. CareFusion said the buyout offers an opportunity for the company to expand its Pyxis line of products in markets outside the United States.

—OncoSec Medical, a three-year-old San Diego company developing a proprietary electroporation technology that’s intended to make cancer drugs more effective, raised $3 million through a private stock placement. The company trades on the over-the-counter bulletin board as ONCSD.

—San Diego-based Apricus Biosciences (NASDAQ: APRI) sold BioQuant, its contract research organization (CRO) subsidiary, to BioTox Sciences for $5 million in up-front and future earn-out payments and a potential to get as much as $20 million over the next 10 years. Apricus Bio said it retained all NexMed-related research conducted by Bio-Quant as well as BioQuant’s profitable diagnostic kit business. Apricus, which was previously a New Jersey life sciences company known as NexMed, moved to San Diego after it acquired BioQuant about eight months ago.

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San Diego-based Cadence Pharmaceuticals (NASDAQ: CADX) won FDA clearance in November to start selling the first intravenous form of a common pain reliever, and it’s already attracting competition from a generic rival.

The FDA’s website was updated today to show that another company is seeking to sell a generic version of injectable acetaminophen, which Cadence markets under the brand name Ofirmev. The FDA website didn’t disclose the name of the company seeking to bring the generic treatment to the market. Cadence, in a regulatory filing, noted that its drug is covered by two patents. The product in question here is different than the acetaminophen tablets you can find at every corner drugstore, marketed under the name Tylenol.

“We firmly believe in the strength of our patents. We anticipated challenges and are prepared to vigorously defend our intellectual property rights to Ofirmev,” said Cadence CEO Ted Schroeder, in an e-mailed statement.

No doubt, Cadence has good reason to gear up for a legal battle to defend its patents. Its reformulated version of acetaminophen, used in hospitals, is the company’s only product that is currently available for sale on the U.S. market. Cadence has positioned the new drug as an option for hospital-based patients who can’t take oral pain relievers, and as an alternative to opioid-based narcotic pain relievers that can be addictive and cause side effects, like chronic constipation. Cadence has reported strong initial demand from hospitals for the product. The company has said it expects its drug to win a spot on the preferred drug lists of 1,000 to 1,200 hospitals by year’s end, compared with its original forecast of 800 to 1,000 hospitals.

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There seemed to be a spate of financings among San Diego’s life sciences companies in recent weeks, and some local CEOs are telling me more deals are in the works. Your briefing begins now.

—San Diego has added another startup to its growing cluster of companies developing next-generation genome sequencing and molecular diagnosis technologies. BioNanomatrix, which has raised nearly $29 million to develop its proprietary nano-scale DNA mapping technology, said it has moved its headquarters from Philadelphia to San Diego’s Torrey Pines mesa.

—Awarepoint‘s new CEO, Jay Deady talked with me about his strategy for expansion at the company, which specializes in proprietary wireless real-time location system for tracking equipment and supplies in hospitals and other health care facilities. Deady, who has been working to raise another round of venture capital, has moved to diversify Awarepoint’s products and has beefed up the company’s sales reps and account managers.

—Cambridge, MA-based Vertex Pharmaceuticals (NASDAQ: [[VRTX]]), which has substantial operations in San Diego, agreed to pay $60 million upfront, and as much as $1.46 billion in follow-on payments to license new hepatitis C drug candidates from South San Francisco-based Alios Biopharma. I got a note from the Latham Watkins law firm, which was involved in the deal, that says: “This is the largest partnering deal Latham has ever done, the largest preclinical deal in history, the largest [hepatitis C] deal in history, and one of the 5 largest deals overall in biotech history. Had the full economics been announced, it would have been the largest biotech deal ever.”

—Luke’s BioBeat column argued that Twitter has become too useful for biotech executives to ignore anymore, and I think the same argument could be made for executives in other industries as well. As Luke put it: “I’ve been careful to follow people that have valuable and relevant information to report and share, while unfollowing everything else. I’ve expanded my professional network around the world by having conversations with readers I never would have met any other way. I’ve gotten story tips. And this is all happening even while … Next Page »

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The last time Xconomy checked in with Pacira Pharmaceuticals (NASDAQ: PCRX), in early 2009, the company was laying off a third of its workforce in the wake of a disappointing clinical trial of Exparel, a treatment for post-surgical pain. Pacira was capital-constrained because the market for life-sciences IPOs was all but dead. And the future was far from certain for the company, which has corporate offices in Parsippany, NJ, and manufacturing and R&D operations in San Diego.

Fast-forward two years and it’s pretty clear Pacira’s fortunes have changed, so much so that the company was able to pull off an IPO in February. Pacira’s executives have been busy presenting data on its pain treatment, most recently at a medical meeting on May 17, when they announced positive results in patients undergoing hemorrhoid surgery. Pacira’s stock is now trading at $10.30—a 47 percent premium to its offering price, and a clear signal that Wall Street fully expects the FDA to approve the pain treatment by its scheduled PDUFA date of July 28.

The main conference room in Pacira‘s Parsippany headquarters bears a sign reading “Exparel War Room”—a fitting description of what the company has been through in the years leading up to, and including, the IPO. “This is the hardest thing I ever did in my life,” declares CEO Dave Stack, a pharmaceutical industry veteran and partner at MPM Capital, who did stints at The Medicines Company, Innovex, and others before being brought in to lead Pacira’s turnaround in 2007.

Pacira was originally DepoTech, a San Diego company that developed a controlled-release drug-delivery technology called DepoFoam. UK-based SkyePharma acquired DepoTech in 1998, but struggled to manage the asset, Stack says, so a syndicate of venture capitalists bought it in 2007 and reformed it as Pacira.

The VCs—MPM, HBM BioVentures, OrbiMed Advisors, and Sanderling Ventures—chose Stack to run Pacira primarily because of his track record. At The Medicine’s Company, Stack and his team developed a marketing plan for the blood thinner bivalirudin (Angiomax) that entailed going into large hospital chains and reviewing the charts of patients who had been given heparin—a cheap and well-accepted alternative to the newer product. Stack and nine cohorts (all of whom are now at Pacira) determined a set of characteristics that could predict which patients were most likely to develop bleeding incidents from heparin that would keep them in the hospital for several extra days. “We wrote algorithms that allowed hospital computers to flag patients” who were most likely to respond badly to heparin, Stack explains. “Then they could say, ‘We should be using Angiomax instead.’”

It worked: bivalirudin turned into a $400 million-a-year product.

Stack has developed a similar plan for marketing Exparel, which is a long-acting version of the pain drug bupivacaine. After major surgeries, bupivacaine is commonly injected into the tissues surrounding the surgical wound. It typically provides pain relief for about eight hours, after which patients are given opioids such as morphine, which can cause serious … Next Page »

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Cadence Pharmaceuticals had to wait a little longer than it wanted, but today it got its wish.

The San Diego-based biotech company (NASDAQ: CADX) said today it won FDA clearance to start selling an intravenous form of the pain reliever acetaminophen (Ofirmev) for use in hospitals. The drug, known in its over-the-counter form as Tylenol and Excedrin, has never cleared for sale before as an intravenous form in given in U.S. hospitals.

The approval is a big deal for Cadence, because this represents its first marketable product in the U.S. It’s also a mark of perseverance, given the company suffered two regulatory delays in the past year. The new treatment offers an alternative for patients who can’t take oral pain relievers in the hospital, and provides medical personnel another alternative to opioid-based pain relievers that can be addictive and cause serious side effects, like chronic constipation.

Cadence now plans to introduce its new drug to the U.S. market before the end of March, CEO Ted Schroeder said in a statement. Cadence doesn’t have the European rights to the drug, although acetaminophen is approved there, and has the most market share among injectable pain relievers in hospitals, Cadence said.

“The approval of Ofirmev is a significant milestone for Cadence as we advance our mission to improve the lives of hospitalized adults and children,” Schroeder said in the statement.

The last time I talked with Schroeder in depth about the market potential of the IV acetaminophen, a lot of things were different, including the drug’s brand name. At that time, Wall Street was ballparking the price at $8 a dose, and the overall market opportunity in the U.S. at about $500 million. Cadence’s market research at the time suggested that as many as 70 percent of patients undergoing surgery complain that existing drugs don’t control their pain well enough, and the company was hoping to position its treatment as a safer alternative.

Cadence plans to discuss the approval and its commercial plans on a conference call with investors at 5 pm Eastern/2 pm Pacific today.

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Mark Corrigan, the chief executive of the biotech Zalicus (NASDAQ:ZLCS), has been shuttling back and fourth from Boston to New York this week as part of the Cambridge, MA-based firm’s effort to gain greater visibility on Wall Street. In fact, last Friday he was due to ring the closing bell at the NASDAQ stock market in Times Square.

Founded in 2000, the company, known for most of its history as CombinatoRx, has burned through more than $230 million to develop its drugs. It was one of the high-flyers in the local biotech scene until its lead treatment for arthritis faltered in a mid-stage clinical trial two years ago. Now the company, with a new name and a new FDA-approved drug, is out to reinvent its image in the investment community.

Last week the company changed its name from CombinatoRx to Zalicus (and no, the firm didn’t name itself after Zalicus, the armored character from the video game World of Warcraft). While name changes aren’t typically news, this company’s renaming deserves special attention because it relates to the December 2009 merger of CombinatoRx and Vancouver BC-based Neuromed Pharmaceuticals. By acquiring Neuromed, the new company obtained a long-lasting opioid pain reliever (Exalgo) that has been available on the U.S. market since April. It’s the first marketed product for Zalicus, and it changes the complexion of the company quite a bit.

Before the merger with Neuromed, Zalicus’s business was built entirely on its system that seeks synergistic combinations of compounds to form new treatments for diseases. That technology has helped the firm gain its research and development deals with the Swiss drug maker Novartis (NYSE:NVS) and Thousand Oaks, CA-based biotech giant Amgen (NASDAQ:AMGN). Neuromed, like the name used to suggest, developed neurological drugs like the long-lasting opioid pain reliever. The product (Exalgo) is marketed by health products giant Covidien (NYSE:COV). Zalicus has also chosen to maintain a research operation in Vancouver that is focused on discovering drugs that block proteins called calcium channels to treat pain.

Still, the company’s lead clinical candidate is an arthritis treatment called Synavive. It’s a combination of a cardiovascular drug and a corticosteroid that resulted from the firm’s original combinatorial drug-screening technology.

The name change gives the company an excuse to tell its story to investors and regain faith among stock buyers on Wall Street. Investors bolted from the firm’s stock after it reported in October 2008 that … Next Page »

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San Diego-based Zogenix, which markets a needle-free injector for treating migraines, intends to raise $90 million through an initial public stock offering, according to a recent regulatory filing.

The biotech startup, which I profiled last month, has also been developing compounds for treating pain and central nervous system disorders, and plans to pair each new drug with its proprietary “DosePro” injector as a drug-and-device combination in seeking FDA approval. Zogenix CEO Roger Hawley told me the company has raised nearly $200 million ($164 million in venture funding and $35 million in debt financing) since it was founded in 2006.

Zogenix withdrew from a previous IPO filing that it submitted in 2008. Hawley told me last month the company required additional funding, and hinted that he wanted to get the Zogenix board to consider another IPO attempt.

Zogenix made the commercial launch of its migraine injector, which delivers the drug sumatriptan, in the United States nine months ago; it sells the drug-and-device combination as Sumavel DosePro, under a marketing agreement with Astellas Pharma. Zogenix says it also has entered into a partnership with Germany’s Desitin Arzneimittel GmbH to accelerate development and regulatory approvals in Europe.

The company also is in late-stage clinical trials for a formulation of hydrocodone, which Zogenix licensed from Elan, for treatment of severe, chronic pain in patients requiring around-the-clock opioid therapy.

In its filing with the SEC, Zogenix details its financial risks, saying the company is “largely dependent on the commercial success of Sumavel DosePro,” and has recognized just $6.1 million in net product revenue from January through the end of June. The company has incurred substantial losses since it was founded. It disclosed a net loss of $45.9 million in 2009 and $49.3 million for the first half of 2010, and shows accumulated debt of $173.8 million. The company also identifies extensive competition among large, well-capitalized companies offering treatments for migraines which, like Zogenix’s injection, are in the so-called triptan class. Zogenix says it expects its losses and negative cash flows to continue at least for several more years.

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It took centuries for the basic concept of a syringe—a plunger that fits tightly in a tube—to evolve into the medical hypodermic syringe, which uses a hollow needle to inject medication beneath the skin.

The founders of San Diego’s Zogenix say they have developed a faster and simpler method for subcutaneous injections—and on a much faster track.

The specialty pharmaceutical company was founded just four years ago, and won FDA approval for its combined migraine drug and needle-free delivery system in mid-2009. It began selling its sumatriptan delivery device in January, under a marketing agreement with Illinois-based Astellas Pharma that was announced last August.

Zogenix also found time since 2006 to raise a total of $199 million in capital ($164 million in venture funding and $35 million in debt financing) and to initiate a pivotal, late-stage trial of a controlled-release formulation of a second drug candidate, a novel tablet form of hydrocodone for long-term, chronic pain.

Suffice it to say, the company has accomplished a lot in a short time.

Roger Hawley

But Zogenix CEO Roger Hawley says it wasn’t exactly clear what technologies Zogenix would develop when he founded the startup with seed funding from some of San Diego’s most-prominent life science investors, including Cam Garner, the former chairman and CEO of Dura Pharmaceuticals. Hawley, who had previously worked at Brisbane, CA-based InterMune and Glaxo, says he met Garner after Elan had acquired San Diego-based Dura for $1.8 billion in 2000.

“Cam was sort of exiting Elan at the time when I was recruited,” Hawley says. They were both founding investors in the startup, along with Jim Blair of Domain Associates, Hybritech founder David Hale, and Scott Glenn, a former Quidel CEO who was then with San Diego-based Windamere Ventures. “We all put a little seed money into the company, and I started looking for a product,” Hawley says.

As it turned out, Hawley says the first product they looked at was a … Next Page »

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Cadence Pharmaceuticals (NASDAQ: CADX), the San Diego-based developer of a pain reliever for use in hospitals, said today it has re-submitted its new drug application for the IV form of acetaminophen (Ofirmev) to the FDA. The company’s earlier application was delayed on February 10, when the FDA said it found deficiencies on an inspection of a third-party manufacturer. Cadence said it met with the FDA on April 16 to discuss the deficiencies found in the letter, and the agency didn’t require any new studies.

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CombinatoRx has garnered its first drug approval. It’s a milestone for the Cambridge, MA-based drug developer, even if the path the company took to reach this point isn’t the one its founders had mapped out when they launched the company in 2000.

The FDA has approved the pain drug hydromorphone HCL (Exalgo), which is an extended-release tablet taken once a day for people with moderate to severe aches and pains, the company (NASDAQ:CRXX) reports today. The firm took on U.S. development of the drug through its December merger with Vancouver-based Neuromed Pharmaceuticals. In other words, the pain tablet is not a product of CombinatoRx’s own drug-discovery system, which uses computers to find novel treatments based on synergistic combinations of other drugs.

The approval has earned CombinatoRx—which still has a Vancouver office—a $40 million milestone payment from the healthcare products giant Covidien (NYSE:COV). Covidien, which has its corporate offices in Mansfield, MA, acquired U.S. rights to the pain treatment from Neuromed last year and is handling all marketing of the drug through its Mallinckrodt unit. CombinatoRx will get royalties on drug sales from Covidien, which plans to begin selling the product in the first half of this year.

CombinatoRx’s work on this pain drug is largely over, since Covidien is now responsible for all marketing and post-approval studies of the drug. Also, the ALZA unit of Johnson & Johnson (NYSE:JNJ), which licensed U.S. rights to the drug to Neuromed in 2007, is in charge of manufacturing supplies of the product that will be sold by Covidien in the U.S. CombinatoRx’s next closest drug to the market is its combination therapy for arthritis, which is in mid-stage clinical development.

The approval has given CombinatoRx’s stock a shot in the arm. According to Google Finance, the stock was up 45 cents, or 40.5 percent, to $1.56 per share in pre-market trading this morning.

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San Diego-based Cadence Pharmaceuticals (NASDAQ: CADX) said today that the FDA has pushed back its deadline for reviewing the company’s intravenous pain reliever by three months. The FDA’s new deadline for completing its review of IV acetaminophen is now Feb. 12. The company said it remains confident it will win FDA approval, although shares fell 5 percent today on the news.

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[Updated: 10/06/09, 10:55 am Pacific] San Diego’s Transdel Pharmaceuticals released a mixed bag of clinical trial results this morning. The company’s topical pain reliever fell short on one of its two primary goals in a 364-patient study, but was successful for about two-thirds of patients who followed the study rules.

Transdel (OTC BB: TDLP) reported this morning that its topical cream version of ketoprofen, a potent non-steroidal anti-inflammatory drug from the same class as ibuprofen, was statistically better than a placebo in relieving pain after three days among the 252 patients with soft tissue injuries (sore necks, ankles, elbows, etc.) who followed the study protocol. The drug failed to show such an advantage, however, when researchers factored in the rest of the patients, who didn’t apply the drug correctly, or who took other medications, such as recreational drugs, that weren’t allowed under the study’s rules.

Transdel CEO Juliet Singh told investors today on a conference call that the company plans to discuss the results with the agency to talk about the best way to bring the drug forward. Singh, who previously worked with regulators to win market approval for botulinum toxin (Botox), says the FDA has asked to see both analyses of patients who follow the study rules and the whole population. If Transdel can convince the FDA to approve its product for sale in the U.S., it will start tapping into a global market for pain relievers that was worth $19.1 billion in 2008, and is expected to grow to $32.8 billion by 2013, according to market research firm BCC Research.

[Updated next three paragraphs with comments from Singh.]

“We have a successful Phase III study,” Singh says. “The FDA will look at both analyses in this trial.” The agency, “is fully aware of the challenges,” with examing all patients who enroll in a pain study, Singh adds.

Acute pain studies like Transdel’s are difficult to run because patients don’t have a chronic illness like cancer or diabetes, and sometimes don’t show up for follow up visits or fully follow study directions, Singh says. She stressed that Transdel didn’t fish through the data retrospectively to look for who benefitted—a practice many companies use to try to show some benefit for their drug. Rather, Transdel had planned in advance to do the analysis on patients who followed the protocol, and it was one of the study’s primary goals from the start, she says.

Hitting that goal of showing effectiveness in patients who completed the study is “a great achievement,” Singh says. She added, “This is where other companies have failed.”

The Transdel drug, to be marketed as Ketotransdel, is made to seep through the skin near the area of the body that’s in pain, without being fully absorbed into the bloodstream. That’s thought to help it avoid the side effects, such as stomach bleeding, sometimes caused by oral medicines from the same class.

The Transdel cream appeared to have a similar safety and tolerability profile to a placebo cream, and it wasn’t associated with any problems in the stomach or the heart, Transdel said in a statement. Only “minimal” concentrations of the drug were found in the bloodstream of a subgroup of patients who underwent that analysis.

Transdel plans to save more of the details from the trial for presentation at an upcoming medical meeting, and for publication in peer-reviewed journals.

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Sequenom had the big story for San Diego’s life sciences community this week. We have the latest developments about that, as well as other biotech news.

—Sequenom (NASDAQ: SQNM) now faces a long rebuilding process after the San Diego medical diagnostic company ousted president and CEO Harry Stylli and a senior vice president of research and development over mishandled data in the development of a prenatal test for Down Syndrome. Five others also left the company after a five-month internal investigation invalidated studies that said Sequenom’s test, which uses a simple blood draw from pregnant women, was 100 percent accurate at detecting Down’s in a developing fetus. Now those tests will have to be re-done.

—A legal dispute over genetic-sequencing technologies and products is beginning to look more like a free-for-all. Carlsbad, CA-based Life Technologies (NASDAQ: LIFE) has filed a patent suit against San Diego rival Illumina (NASDAQ: ILMN) which is already engaged in similar litigation with Affymetrix (NASDAQ: [[ticker:AFFX) of Santa Clara, CA.

—San Diego-based Zogenix has collected $36 million in a $51 million equity financing round intended to fund the company’s January launch of its needle-free system for delivering a pain drug for migraines. Zogenix says its delivery system releases a quick increase in pressure to penetrate the skin and then injects liquid medicines—without needles.

—Fate Therapeutics CEO Paul Grayson says the San Diego biotech startup is in advanced talks about partnerships with several large pharmaceutical companies about partnerships. Luke says the fast-growing company is using genetically engineered proteins and small molecule compounds to nudge ordinary adult cells into becoming pluripotent stem cells, which have the potential to turn into any cell type.

—Juliet Singh knows how to rub it in. Singh, who oversaw efforts to Irvine, CA-based Allergan (NYSE: AGN) to get FDA approval for botulinum toxin (Botox), is now the CEO of Transdel Pharmaceuticals, a La Jolla, CA-based company. Transdel intends to develop ketoprofen, a common pain reliever used in pills, into a topical cream.

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The woman who helped bring the famous anti-wrinkle treatment Botox to the U.S. market is working on a pain reliever that she says can compete with some of the best-known drugs in the world—Tylenol and Advil.

Her name is Juliet Singh, and she’s the CEO of a tiny La Jolla, CA-based company called Transdel Pharmaceuticals. Singh, 48, was the director of worldwide regulatory affairs at Irvine, CA-based Allergan (NYSE: AGN) in the late 1990s, where she oversaw efforts to get FDA approval for botulinum toxin (Botox), for eye diseases, before doctors discovered it also helps eliminate wrinkles.

Singh’s latest project is to turn a common pain reliever from a pill form into a topical cream. The goal is to make ketoprofen, a potent non-steroidal anti-inflammatory drug from the same class as ibuprofen (Advil, Motrin), into something people can rub directly on the body part that hurts. Ibuprofen has been approved by the FDA since 1974, and taken by millions of people ever since. But the drug has been known to cause stomach bleeding for some people. That’s a big reason why drug companies in the 1990s sought to make Cox-2 inhibitors like Vioxx and Bextra, which were supposed to be safer on the stomach. But they were ultimately pulled off the market because they raised the risk of heart attack and stroke.

The concept at Transdel is that if you can develop a cream formulation of ketoprofen, it will seep through the skin directly into say, a painful neck, elbow, or ankle, without circulating through the entire bloodstream (and possibly cause stomach bleeding.) The company expects to hear a definite answer from pivotal study of 350 patients by the end of this month, which will determine whether the drug is good enough to win FDA approval. If the company passes this test, it will soon be able to dip its toe into a global market for pain relievers that was worth $19.1 billion in 2008, and is expected to grow to $32.8 billion by 2013, according to market research firm BCC Research.

“I truly think our product will be one of the best in the U.S. market and will be recognized like a Tylenol or an Advil,” Singh says.

Transdel doesn’t have the usual big-time VC backers, and it’s a virtual company with a skeleton crew of just a few employees. The company has burned through about $13 million in capital through the end of June, and its shares (OTC BB: TDLP) trade on the bulletin board, which isn’t the place I usually look to find interesting biotech companies.

But Singh has a credible background, as an endocrinologist by training, a former postdoctoral fellow at Genentech, and as someone who built a track record in regulatory affairs at Baxter Healthcare, Allergan, and Collateral Therapeutics before that company was bought by Schering AG (now part of Bayer AG) in 2002.

Transdel has pinned its hopes on proprietary technology to deliver drugs through layers of skin, fat, and nerves, into underlying muscles feeling pain. The approach has been applied with Ketotransdel, its formulation of ketoprofen, a generic pain reliever that’s available over-the-counter in the U.S. The Transdel drug has been made to absorb … Next Page »

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Victory is not yet in sight for San Diego’s Victory Pharma, a specialty drug company focused on pain relievers. A Japanese drug marketer backed out of a $150-million deal to acquire Victory this week, leaving the San Diego pain specialist in need of solace and a new game plan.

Sciele Pharma said in a press release that the companies called off the acquisition because of “an unforeseen development that occurred after the agreement was signed.” Sciele, an Atlanta, GA, unit of Japan’s Shionogi & Co., didn’t elaborate and Victory spokesman and CFO David J. Parker did not return calls.

Although the reasons for the breakup are a mystery, it is worth noting the deal fell apart less than two weeks after an FDA advisory committee called for tougher restrictions on drugs containing the pain reliever acetaminophen, which is found in two Victory products. The FDA committee called for an outright ban on drugs that combine acetaminophen and narcotics, such as Victory’s Xodol, a combination of acetaminophen and hydrocodone. Another Victory pain pill, Dolgic plus, combines caffeine, acetaminophen and butalbital, a barbiturate.

Acetaminophen is the active ingredient in over-the-counter pain relievers like Tylenol, and billions of doses of acetaminophen are safely used every year. But the advisory committee’s concern was focused on acetaminophen overdoses, which can cause liver damage and death. The FDA isn’t required to follow the advice of its committees, but the agency typically does.

Victory markets a total of four prescription drugs, so a ban on one or two of its products would be a significant blow. The venture-backed company had sales of $57 million in 2008, and its lead product was a sustained-release formulation of the pain reliever naproxen sodium. In announcing the acquisition of Victory in May, Sciele said its parent had targeted pain as an area for growth.

Victory’s pipeline includes a MGX006, an experimental treatment for severe nausea and vomiting. The company said this week that it expects to launch the drug during the first half of 2010, pending FDA approval. About 25 million prescriptions are written in the US annually for anti-emetic drugs, according to Victory, which sees opportunity in that market. With luck, MGX006 will help Victory Pharma live up to its name.

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[Updated: 5 pm EST]

Big news this morning from CombinatoRx, the developer of treatments based on combinations of known drugs. The Cambridge, MA-based firm (NASDAQ:CRXX) has agreed to a merger with a privately held biotech firm called Neuromed Pharmaceuticals to beef up its product pipeline and grow its cash surplus enough to operate into 2012, according to a press release.

In merging with Vancouver-based Neuromed, CombinatoRx will gain rights to the Canadian firm’s anti-pain drug candidate Exalgo (an oral, extended-release version of the opioid drug hydromorphone.) The FDA is expected to say whether it will allow the pill to be marketed as a treatment for severe and chronic pain by November 22, according to the companies. On the management front, CombinatoRx’ co-founder and CEO Alexis Borisy is stepping down from his executive roles yet will serve as a scientific adviser to the combined company. Christopher Gallen, president and CEO of Neuromed, is slated to become chief executive of the firm. The company is expected to be called CombinatoRx after the merger.

As a result of the merger plan, CombinatoRx has laid off 20 workers or 36 percent of its staff, the company said this afternoon in a regulatory filing. The company expects a one-time charge of $2.6 million to $2.8 million to cover severance expenses and other costs related to the layoffs. [Editor's note: this paragraph was added to the story to report information in an SEC filing that was made public after this story was initially published.]

The proposed structure of the merger is unusual in that it gives both firms a shot at ending up majority owners of the combined entity. The deal calls for CombinatoRx to issue 36 million shares of common stock to Neuromed shareholders, giving each company’s current shareholders a 50-percent stake in the merged firm. Yet the ownership ratio will change depending on when or if the FDA approves Neuromed’s pain pill. The terms would give Neuromed shareholders a majority stake in the combined company if the drug is approved before October 1, 2010, and CombinatoRx shareholders would become of the majority owners of the firm if the anti-pain drug is approved on or after October 1, 2010, or if it is not approved at all.

The merger is an example of companies combining forces to survive the harsh economic climate. CombinatoRx—which went through a restructuring after its lead drug candidate for osteoarthritis of the knees disappointed in mid-stage clinical trials late last year—is gaining a potential revenue stream from Neuromed’s pain pill. Neuromed recently sold marketing rights to the drug to Mallinckrodt, a subsidiary of Irish medical products giant Covidien, which has promised to pay up to $40 million to Neuromed upon approval of the drug as well as tiered royalties on sales of the product.

The two companies haven’t decided where the combined firm will be headquartered, a CombinatoRx spokeswoman tells Xconomy. The merger is expected to close in the fourth quarter of this year.

Borisy’s severance package includes a lump sum payment of $932,500, two years of free health coverage, and a separate payment of $150,000 as part of a bonus agreement, CombinatoRx said in a regulatory filing.

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Sciele Pharma, an Atlanta, GA, pharmaceutical company owned by Japan’s Shionogi & Co., says it is acquiring San Diego-based Victory Pharma for $150 million. Sciele specializes in the sales, marketing and development of branded drugs for cardiovascular diseases, diabetes, women’s health, and pediatrics.

The acquisition adds Victory’s lead product, a once-daily sustained release formulation of the pain reliever naproxen sodium (Naprelan), to a Sciele drug portfolio that includes fexofenadine HCL (Allegra) for hayfever and nisoldipine (Sular) for hypertension.

The deal announced yesterday comes less than three months after Victory raised $45 million in a secondary venture round headed by Essex Woodlands Health Ventures of Palo Alto, CA. Victory, which also was backed byAmpersand Ventures of  Wellesley, MA, acquired its lead drug product in 2006, and has been developing its own drug candidates for managing pain as well as nausea and other side effects of pain drugs.

In a statement, Sciele’s president and chief operating officer, Ed Schutter, says, “The acquisition of Victory is another important step in the implementation of Sciele’s strategic plan to further diversify our product portfolio and generate additional growth for Sciele.” Sciele’s parent company has targeted the pain market as a therapeutic area, and Sciele says Shionogi plans to accelerate “development of its drug candidate for the alleviation of opioid-induced adverse effects” without clarifying if that means taking on Victory’s drug development.

Victory, which generated $57 million in sales last year, has 182 employees, including 120 sales representatives. The transaction is expected to close before June 30.

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Collegium Pharmaceutical just got some capital that may make it more difficult for people to abuse narcotic pain medicines. The specialty drugmaker based in Cumberland, RI, said today it raised $20 million in a fourth-round venture financing. Seattle-based Frazier Healthcare Ventures led the investment, which included previous investors Boston Millennia Partners and Westfield Capital Management. Patrick Heron, a general partner with Frazier, will join the company’s board in connection with the investment.

The company plans to use to move forward with its lead drug candidate, called COL-003, a form of the pain reliever oxycodone (the active ingredient in OxyContin, Percodan, and other often-abused drugs) that is harder to tamper with and more difficult to abuse. Collegium plans to submit an application to the FDA to market the product in the second half of 2009, says Steven Tannenbaum, the company’s chief financial officer. Results from a study in May, presented at the American Pain Society’s meeting, showed that crushing or chewing up the capsule before swallowing it—a common tactic drug abusers use to get high—didn’t boost the amount of active ingredient reaching the bloodstream.

Some of the cash will also be used to develop and market foam formulations of drugs for skin disorders, that are sold through the Collegium’s subsidiary, Onset Therapeutics. The company lists 10 specific drugs in its pipeline for neurology uses and respiratory diseases on its website, plus programs in skin disorders.

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