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some key markets such as treatments for Fabry disease. After viral contamination at Genzyme’s Allston, MA, facility in June 2009 temporarily delayed production of prime Genzyme drugs such as agalsidase beta (Fabrazyme) for Fabry patients, Shire was able to gain the FDA’s permission to provide its own Fabry drug agalsidase alfa (Replagal) to patients in need of the enzyme-replacement treatment. Shire overtook Genzyme as the world’s No. 1 provider of Fabry treatments last year, Gregoire says.
Now it appears that Shire HGT will have to compete with a Genzyme unit owned by one of the world’s largest drug companies. That might mean that Shire HGT, which had 2010 sales of more than $900 million, will have to maneuver against Sanofi for deals with smaller biotechs who are seeking investments to commercialize their rare disease products.
Gregoire says that her company has a lot of experience in developing rare disease drugs and bringing the medicines to market. Also, she claims that Shire HGT (formerly Transkaryotic Therapies) has a track record of forging alliances with smaller companies that provide attractive terms for both sides.
“Sometimes these small companies don’t want to be bought,” Gregoire says. “They want to see if they can build themselves into a company of their own. You’ll see that we’ve done all kinds of deal structures that try to accommodate them rather than just try to just force any deal structure that we mandate.”
“This is something that sometimes in larger pharmaceutical companies they don’t want to bother with, or they are not as flexible as we would be or not as quick, frankly, at looking at an asset or judging an asset,” she says.
Large drug companies have made moves to expand their research expertise in the rare diseases market. New York-based drug giant Pfizer (NYSE: PFE), for example, has made a series of moves over the past year or so in this arena with its buyout of Cambridge, MA-based FoldRx Pharmaceuticals, and its announcement of plans to establish a rare disease research group in Cambridge.
For Leschly’s part, pharma’s interest in rare diseases was part of his thesis for investing in Bluebird when he was a partner at Third Rock Ventures in Boston. He took over as CEO after the venture firm led a $35 million Series B round of financing for the company in March 2010.
“Whether it’s Sanofi, Genzyme, or one of these other companies, I’m a big fan of more interest,” Leschly says. “Drug development is very expensive and very long. So we need a sustained commitment. Those are serious dollars and serious commitments.”