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When GSK recently inked a $2.1 billion development and marketing deal for Genmab’s HuMax-CD20 antibody, it was probably largely inspired by the fact that six mAbs-based therapeutics have already reached “blockbuster” status, with sales rocketing to over $1 billion each. HuMax-CD20 is in Phase III trials for chronic lymphocytic leukemia (CLL) and non-Hodgkin’s lymphoma, as well as Phase II for rheumatoid arthritis and as a first line therapy for CLL. The drug is regarded as one of the most potentially lucrative mAbs in development.
Analysts at Datamonitor estimate the worldwide mAb market will triple by 2010 to more than $30 billion. This growth, plus the relatively certain protection from generic competition, is giving big pharma the green light to move from partnerships to acquisitions.
MAb Madness
“There is high-level interest in mAb commercial opportunities because they are now well recognized as good methodologies for targeted therapies,” says Elise Wang, managing director, senior biotechnology analyst at Citigroup-Smith Barney.
However, she says when it comes to merger and acquisition activity between pharma and biotech, there’s usually an existing relationship. This is the case with Genentech and Tanox, which have been collaborating with Novartis since 1996 to develop and commercialize Xolair — an anti-IgE mAb for treating allergic asthma. “From a financial point-of-view, the acquisition is beneficial to Genentech since the company has been paying royalties to Tanox for Xolair,” says Frost & Sullivan analyst, Adriana Ruso.
In addition, from a strategic point of view, adds Ruso, while Tanox’s pipeline is complementary to Genentech’s, it also adds new therapeutic areas where the mAb market is expanding. This includes Tanox’s lead investigational drug, TNX-355, which belongs to a new class of HIV drugs that block the virus from entering cells rather than stop its replication inside the cell. “Their therapy for HIV is a very interesting first-in-class molecule that has demonstrated anti-viral activity in Phase II studies,” says Mary Stutts, Genetech’s director of corporate communications. “We’ll go through our process of evaluating [TNX-355] to determine whether we want to develop it internally or through a collaboration.”
Although this is Genentech’s first acquisition, Stutts says this is not a shift for the company. The focus will remain on internal discovery and development of therapeutics. However, the company will continue to look for opportunities similar to what Tanox offers — strong scientific results and a therapeutic overlap with Genentech’s efforts.
The Next Generation
Another growing trend in the mAb market is that increased FDA scrutiny and safety profiles of new drugs are moving the market towards fully humanized antibodies without the side effects of murine or chimeric antibodies.
Like Genentech and Tanox, AstraZeneca and CAT have collaborated since 2004 to discover and develop human antibody therapies. CAT’s first antibody approved for marketing, HUMIRA (1st fully humanized antibody), reached blockbuster status this past January. The industry has “advanced the technology to the point where [there are] have several fully humanized antibodies on the market (9) and a few chimeric ones,” says Wang. There are “still a huge number for various disease indications under development.”
Next generation antibodies, such as Nanobodies, combine the advantage of conventional mAbs with those of small molecules, reducing side effects and production costs. Ablynx develops nanobody-based therapeutics in several disease areas: inflammation, thrombosis, oncology, and Alzheimer’s disease. Derived from naturally occurring heavy-chain antibodies of llamas, the small (12-14 kilodaltons) single domain antibody fragments are very stable and can be delivered by various methods. Their unique structure enables them to target epitopes like receptor clefts and enzyme active sites.
The company recently entered a research collaboration and licensing agreement with Wyeth to discover and develop Nanobodies directed at tumor necrosis factor alpha (TNFa) protein and its receptors that target diseases in multiple therapeutic areas. The deal could represent up to $212.5 million for Ablynx in up-front fees and milestone payments.
“The reason we’re attracted to Ablynx is because they have pioneered the use of Nanobodies and they have a good patent position,” explains Frank Walsh, executive vice president, head of discovery research at Wyeth. “Also, since we have Enbrel, we’re always looking for follow-up reagents.” He says the collaboration will determine if the Nanobodies are more efficacious than existing reagents and if they offer a better immunogenicity profile. “If all those things go well, we could have a very competitive product.”
Eva-Lotta Allen, Ablynx’ chief business officer, says the company is building a pipeline from its own discovery efforts and will drive programs forward with partners “where it makes sense.” “It depends on our knowledge and resources,” she explains. “As a small company we have to stay focused, but at the same time, we want to maximize the opportunity and take advantage of our platform.”
Small Protein Prospects
Dyax Corp. has licensed its proprietary antibody phase display libraries to ZymoGenetics for discovery of therapeutic antibodies. Dyax will receive upfront and annual royalties on products developed from their phage display libraries.
“We have three types of libraries in-house and we’re the only company that practices phage display that broadly. We use the technology to discover mAbs, small proteins, and peptides,” says Ivana Magovcevic-Liebisch, general counsel and executive vice president, corporate communications. She says their mAb library is diverse with high affinity in the picomolar range that doesn’t require affinity maturation — reducing development time by up to a year.
“I think the next wave of therapeutics is going to be small proteins,” she says. The company’s lead product is a recombinant, small protein, DX-88, that specifically binds and inhibits serine protease. This is being co-developed by Genzyme and is currently in clinical trials for hereditary angioedema and to prevent blood loss during heart surgery. She adds that the attrition rate is still very high for most biologics because there are not many validated targets, and many are already protected by IP. “The first hurdle is to come up with a target that’s going to be relevant in some disease,” she says.
Although mAbs are no longer considered “magic bullets,” potentially improved efficacy and lower toxicity versus conventional drugs make them especially appealing to big pharma. In addition, the promise of next-generation antibodies continues to spark research efforts and encourage more competition in the market.
“MAbs as a class is going to continue to emerge as an area where we’re going to see more and more commercial products. Whether you see M&A generated from that is going to be dependent on what those specific products represent as potential successes as opposed to the fact they are mAbs,” summarizes Wang.
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