Biotech | Test Results, FDA Decisions on the Horizon
Monday, December 31, 2007
Edward M. Rudnic, chairman of the Tech Council of Maryland, has been at the center of the region's biotech business for more than a decade. He sketched out the idea behind MiddleBrook Pharmaceuticals at a friend's dining-room table. If there is a biotech event around town, he's probably speaking or introducing someone there.
So perhaps there is no better person to ask about what 2008 holds for the region's drug development industry, which has been long on promise but somewhat short on products -- and profits.
"I think it's probably one of the biggest years for what you would call make-or-break moments," said Rudnic, chief executive of Germantown-based MiddleBrook. "In Montgomery County for certain, it's hard to remember a time when so many companies had very significant events happening in the same year."
And it all starts with Rudnic's company. Sometime in late January, MiddleBrook executives will learn from the Food and Drug Administration whether their once-a-day amoxicillin was approved. The ups and downs of the product's development -- it failed late-stage testing, causing layoffs and a return to the drawing board -- have left the company low on cash.
How big is the moment for MiddleBrook? That's best answered by what would happen if the company gets denied. Rudnic said: "It would be an extremely negative day. It would be about as negative as you can imagine." On the other hand, an approval could make the company a target for buyout by a big drug company. "The interest in the product is fairly healthy, but I think that a lot of people would rather pay more for an approved product," he said.
That scenario is in many ways what drove some of the biggest news in the region's biotech sector in 2007. Global drug giant AstraZeneca, desperate for new drugs to sell, bought MedImmune for $15.6 billion, capping off one of the biggest biotech mergers. MedImmune sells Synagis, an industry blockbuster, and it recently got an FDA go-ahead to sell its nasal flu vaccine to more children. Digene, which developed a screening test for a virus that causes cervical cancer, sold itself to Qiagen, a Dutch company, for $1.6 billion.
The lesson: Biotech companies with products are valuable rarities.
MiddleBrook is not the only company hoping for an FDA nod in 2008. Vanda Pharmaceuticals of Rockville is expecting an FDA decision in August for its schizophrenia drug. Vanda is at the forefront of a new breed of drug companies that doesn't develop drugs from scratch. They find products abandoned by other companies and either start testing again or find new uses for the drugs.
In Vanda's case, Novartis abandoned a schizophrenia treatment called Iloperidone. Vanda licensed it for $500,000 in 2004. Four years later, the drug could hit the market. Contrast that potential result with a company like Human Genome Sciences, which mostly develops drugs from scratch. It has been around 15 years, with no products.
Vanda is also expecting final testing results this year on an insomia drug that it bought off the shelf of Bristol-Myers Squibb.
"I think it's a pivotal year that can springboard us into a commercial company," said Vanda chief executive Mihael Polymeropoulos.
Other companies expecting significant product-related events in 2008 include United Therapeutics; GenVec; Human Genome Sciences; and QRxPharma, which is based in Australia but run locally by prominent biotech entrepreneur John Holaday.