Posted on March 27th, 2013
by Paul Ashton, Ph.D.
The Pharma world is all about innovation: new treatments, better treatments and methods that transform the way diseases are treated. Innovations that achieve this transformational change in therapy are what drive research, and can be massively profitable.
Developing new drugs to achieve transformational change, Big Pharma’s traditional path, is very time consuming, risky and expensive. On average it takes over 13 years to develop a new drug, fewer than 1 in 20,000 new drug candidates ever make it to approval and the average cost is well over $1 billion. Fewer than 25% of approved drugs even cover their own development costs. New drug discovery is a daunting undertaking, but when successful the rewards for drugs that provide transformational change can be huge.
There is another way to achieve this: Strategic Drug Delivery.
Strategic Drug Delivery companies can make products that provide transformative change AND make money. They can also do it at fractions of the time, risk and cost of developing a new drug molecule. Strategic Drug Delivery looks for the therapeutic gaps in clinical practice and applies currently available drugs plus new delivery technology to fill those gaps and to create transformational change. You can consider it as a mathematical equation
Therapy Gap + (Current Drug X Technology) = Transformational Change
Take away anything on the left of the equation and it’s hard to achieve the right of the equation.
A great example of Strategic Drug Delivery is Concerta. Before Concerta ADHD therapy wasn’t much good, pills needed to be taken 3 times a day, something children find hard to do when they are at school. A once a day sustained release pill that the parents could give at breakfast was a game changer and a multi-billion dollar product (Concerta). Therapy Gap + (Current Drug X Technology) = Transformational Change. Alza, the maker of Concerta, was subsequently acquired by JNJ for over $10B.
pSivida is a Strategic Drug Delivery Company with a history of not only coming up with products that provide Transformational Change, but also of getting them approved. Our main focus is on ophthalmology and diseases of the back of the eye. That’s where there are a lot of therapy gaps. Many eye diseases, many drugs that potentially work, and no convenient way to get them to the back of the eye. The two leading drugs for eye disease right now (Eylea and Lucentis sharing a $4 billion+ market) have to be injected into the eye every 1-2 months…..indefinitely.
We make sustained delivery systems that provide Transformational Change for the treatment of blinding eye diseases.
Our first product Vitrasert (partnered with Bausch and Lomb) was the first FDA approved drug for a back of the eye disease. This implantable device releases an anti-viral to treat CMV retinitis, a blinding AIDS associate disease.
Our second approved drug Retisert, partnered Bausch and Lomb and approved by the FDA in 2005, was the first approved therapy for posterior uveitis, a blinding autoimmune disease that’s the third or fourth largest cause of blindness in the developed world.
Our most recent product ILUVIEN (partnered with Alimera Sciences and approved in the EU) is the first long term implant approved for Diabetic macular edema, one of the most common causes of vision loss. This implant is a big step forward. It releases medication for three years after a SINGLE injection. It’s scheduled to go on sale (initially in Germany) at the end of this month. There is a lot of focus on this product and rightly so given its importance for patients (one injection per three years versus an injection every 4-6 weeks) the size of the market (about 1 million in the EU) and the very large economic upside for us (we have received $30m from Alimera thus far and will take a sizable piece of profits.
In my next blog I look forward to updating you on the commercial launch of ILUVIEN, EU pricing and the progress towards US approval, and share my own take on developments in the Pharma World.
Forward Looking Statements
SAFE HARBOR STATEMENTS UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995: Various statements made in this blog are forward-looking, and are inherently subject to risks, uncertainties and potentially inaccurate assumptions. All statements that address activities, events or developments that we intend, expect or believe may occur in the future are forward-looking statements. The following are some of the factors that could cause actual results to differ materially from the anticipated results or other expectations expressed, anticipated or implied in our forward-looking statements: uncertainties with respect to: Alimera's ability to obtain regulatory approval for ILUVIEN for DME in the U.S. through the advisory committee or otherwise, and if approved, to finance, successfully commercialize and achieve market acceptance of, and generate revenues to pSivida from, ILUVIEN for DME in the U.S.; Alimera's ability to finance, achieve additional marketing approvals, successfully complete pricing and reimbursement discussions for, commercialize and achieve market acceptance of, and generate revenues to pSivida from, ILUVIEN for DME in the EU;; the ability to finance, complete and achieve a successful outcome for Phase III trials for, and file and achieve marketing approvals for, Medidur for posterior uveitis, including efficacy, side effects and risk/benefit profile, as well as uncertainty as to the ultimate results of the investigator-sponsored trial for Medidur for posterior uveitis; initiation, financing and success of Latanoprost Product Phase II trials and exercise by Pfizer of its option; ability to utilize Tethadur and BioSilicon to develop product candidates and products and potential related collaborations; initiation and completion of clinical trials and obtaining regulatory approval of product candidates; continued sales of Retisert; adverse side effects; ability to attain profitability; ability to obtain additional capital; further impairment of intangible assets; fluctuations in operating results; decline in royalty income; ability to, and to find partners to, develop and market products; termination of license agreements; competition and other developments affecting sales of products; market acceptance; protection of intellectual property and avoiding intellectual property infringement; retention of key personnel; product liability; consolidation in the pharmaceutical and biotechnology industries; compliance with environmental laws; manufacturing risks; risks and costs of international business operations; credit and financial market conditions; legislative or regulatory changes; volatility of stock price; possible dilution; absence of dividends; and other factors described in our filings with the SEC. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Our forward-looking statements speak only as of the dates on which they are made. We do not undertake any obligation to publicly update or revise our forward-looking statements even if experience or future changes makes it clear that any projected results expressed or implied in such statements will not be realized.