Category Archives: Formulation & Delivery

Technology Can Ease the Pain for Individuals and Multinationals Alike

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With all of the billion-dollar or even high-multimillion-dollar pain products such as Purdue’s Oxycontin, Pfizer’s Lyrica, Endo’s Lidoderm, and Janssen’s Duragesic already off-patent or going off-patent within the next five years, developing new or generic pain relieving products is looking more attractive than ever. Complicating this picture is the need to address growing abuse of pain medication. Up to 73.8% of prescription drug overdose-associated deaths in the U.S. were attributed to opioid-based pain relievers. As it is now, there are no overt regulations or requirements on manufacturers or developers to put in measures to deter abuse. Nonetheless, rest assured that the U.S. Food and Drug Administration (FDA), regulatory body of the world’s largest pain product market, is on the move to control the situation.

On this basis, the opportunity for pain medication developers to differentiate is not only clear, but critical. However, likely emerging solutions also open new revenue streams for chemicals and materials developers through materials-enabled delivery devices and formulations that keep the massive pain medication revenues flowing and growing. The Lux Innovation Grid (LIG) of emerging and established pain medication technology developers shows the extent to which we view this opportunity in a positive light. Unusually for LIG, the vast majority of developers are well positioned in, or close to, the dominant quadrant. Developers such as Intellipharmaceutics, Phosphagenics, Egalet, Durect and Encap have taken steps to ascertain their products and are less susceptible to abuse through novel transdermal, topical and oral approaches.

In the rush to occupy gaps left from the aftermath of patent expiries and to address drug developers’ new needs for more agile, open innovation, differentiating one technology developer or service provider from another is critical. For companies struggling to find their place in an increasingly global, affluent, decentralized and aging healthcare market, the partners that can decrease pain and suffering – of end users and their own CFO – are there for the taking.

Source: Lux Research report “Ranking Emerging Delivery Technologies: Scouring the Toolbox to Find a Nut to Fit the Bolt” — client registration required.

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Rolling in the Dough: Formulation and Delivery Developers Continue to Attract Funding

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Formulation and delivery continues to hold strong in early 2013. Despite our previous doubts over the viability of RNA-based therapeutics due to difficulties associated with delivery, and several big pharma exits (Cerulean Pharma (client registration required) and the Arrowhead Research takeover (client registration required)), innovative developers are continuing to attract funding – though the spigots have tightened and money is being released incrementally. Outside of RNA delivery, big pharma continues to turn to technology developers to solve other delivery challenges.

Solistice Biologics, a University of California, San Diego spin-off, closed an $18 million Series A earlier this month. Solistice is working to develop RNAi drugs based on cloaking technology licensed from UC San Diego that enables RNA to pass through the membranes of multiple cell types. Once the RNA sequence has entered the cell, the attached side groups are cleaved by a naturally occurring enzyme.

Israel’s Quiet Therapeutics raised $5.5 million in a funding round that includes Pontifax, Roche Holding, and the Ashkelon Incubator. According to the press release, the first $300,000 will be used to carry out a feasibility study to test its gagomer-based nanoparticle delivery system for cancer and anti-inflammatory therapeutics. Gagomers are lipidated glycosaminoglycan particles used to encapsulate siRNA fragments targeting CD 44 receptors highly expressed on the surface of tumor and inflamed cells. Quiet Therapeutics will receive the rest of the money in increments based on study results.

BIND BioSciences signed a $180 million deal with Amgen to co-develop a nanoparticle-based kinase inhibitor using BIND’s biodegradable controlled-release polymers. BIND claims that its particles, marketed under the name Accurins, are highly selective and programmable, improving efficacy and reducing toxicity. The co- development agreement entitles BIND to a $46.5 million upfront payment and an additional $134 million in milestone payments. BIND’s lead candidate, BIND-014, is currently in Phase I clinical trials.

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Opportunities Arise in Alternative Delivery for Non-Device-Enabled Pharmaceuticals

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Opportunities Arise in Alternative Delivery for Non-Device-Enabled Pharmaceuticals

The drug industry is facing an unprecedented level of challenges, threatening to crumble even the largest of players. Oral deliveries remain the dominant mode of drug delivery. But with a flagging pipeline, looming patent expiries, and increasing competition from new entrants, device delivery technologies offer new potential to boost safety, efficacy, and sales of today’s top-selling drug products

Currently, $124 billion worth of top-selling drugs rely on devices for delivery, but with innovation increasing in the sector, close to half of these drugs are eligible for an upgrade. With $55 billion currently at stake via basic delivery devices, and billions more up for grabs as orally delivered drugs face a patent meltdown, the advanced drug-delivery-device sector looks increasingly inviting to drug-makers.

This week’s graphic comes from a recent report, in which Lux Research surveys the landscape of top-selling drugs facing patent expiration that are currently not device-enabled or are delivered only by basic devices.

It is difficult for device technologies to compete against oral-based delivery, which comprises the majority of device-based alternatives, on convenience or cost. So other factors become paramount, such as localizing exposure to reduce side effects, increase efficiency, or improve compliance with electronic enablement (e.g. alarms).

As the graphic shows, 64 percent of products delivered without devices or with basic devices – accounting for $127 billion worth of revenues in 2011 – will face patent expiry within these five years. More advanced versions of delivery devices, with their high manipulability and potential to address delivery issues will provide technical as well as consumer value, presenting an optimistic route for the life-cycle extension of products facing patent expiry. This is especially true amidst the trend of increasing patient-centric healthcare. It behooves pharmas, generics, and biotechs, as well as biosimilar producers (with the latter two producing biologics and essentially depending on devices for delivery) to explore delivery technologies to enhance their drug product value. Delivery technologies will help them keep pace with the changing demands of their end users, and potentially rescue and rejuvenate revenue potential.

Source: Lux Research report “Making Space for Innovation in Drug-delivery Devices.”

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Seeing the rapid growth in China’s insulin market, Sanofi, Novo Nordisk, and Lilly have been squaring off for a big insulin fight. On June 13h, Eli Lilly announced that its second insulin production and packaging facility – Suzhou East Lake plant, which started construction in 2009 at a cost of $60 million – had finished construction and began operations. Earlier in May, Sanofi China opened a new assembling and packaging facility for prefilled insulin devices in Beijing. This manufacturing facility is a $90 million project, located in the Beijing Economic-Technological Development Area. Both companies are trying to catch up with Denmark based Novo Nordisk, the leading diabetes treatment company in China. Novo Nordisk entered the Chinese market as early as the 1960s, and maintains a dominant 60% of Chinese market share in terms of insulin volume. Currently, Sanofi and Lilly have 15% and 11% respectively, followed by two domestic companies – Tonghua Dongbao 5% and Shanghai Fosun 4%.

Among the various diabetes drugs, the long-acting, or basal insulin drugs are attracting the most attention and companies are competing fiercely in this market subsegment. Currently Sanofi’s blockbuster drug Lantus has about 80% of the market for long-acting insulin worldwide, with total sales of around $5 billion last year. Novo’s new insulin called Tresiba is awaiting U.S. approval by July 29, and is also expected to get the green light in Europe in the second half of the year. Lilly also has a new long-acting insulin, LY2605541, in clinical trials, which may still need years before reaching the market. However, the Phase II clinical tests of LY2605541 showed promising indications of helping patients lose weight, which has caused a stir in the diabetes market, since this could give Lilly a unique selling point and competitive advantage against the other companies.

Since 2011, China has passed Germany as the world’s third largest pharmaceutical market, behind Japan and the U.S., with an estimated growth rate of 20% per year through 2010-2015. China is estimated to have 92 million people with diabetes. Some 40% of them are diagnosed, and only 24% of that population are receiving treatment. The Chinese government is currently implementing healthcare reform – including broadened coverage and benefits, strengthened primary care and rural healthcare services, and improved disease prevention and early diagnosis – in order to improve healthcare accessibility and utilization. Thus, we expect to see tremendous and rapid growth of the diabetes market in China in the coming years. China’s booming diabetes market will bring huge profits for drug-making big pharmas, while investors can expect to see multiple opportunities in related industries like medical devices for diabetes drug delivery and diagnostic sensors and devices.

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Liposomes Show Value in Delivering Diverse Molecules

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Liposomal encapsulation is undeniably one of the more accepted, studied, and proven methods to increase efficacy of poorly-bioavailable drugs. In fact, its use has been so affirmed that it is now applied beyond drug delivery in consumer product applications such as vitamin delivery.

We recently caught up with the Senior Director of R&D at Baxter, Mahesh Chaubal, who apprised us of developments in the liposome technology platform market. As expected, the biggest value proposition now is “smart liposomes,” which aid in targeting drugs to deliver huge payloads more precisely. Historically, the body’s reticuloendothelial (Re) system has been the bane of exogenous injected particles, clearing them out efficiently before they can reach the target tissue or organ system. But rather than continue to fight the body’s defenses, Mahesh noted that scientists are using size, shape, and surface chemistry to turn the Re system to their advantage. He cited work being done at UC Santa Barbara, where early indications show that shape plays a role in effective targeting.

One successful example Mahesh discussed is the reformulation of anti-cancer drug DOXIL, doxorubicin encapsulated into PEG-ylated liposomes. The formulation has now achieved circulating half-lives approaching an impressive 55 hours. He added, however, that repeated injections of PEGylated liposomes show stimulated transient IgM immune responses. Hence, efforts have turned to developing a 14-day cycle administration with increased liposome payload delivery.

Mahesh also lists other applications such as EKR Therapeutics‘ liposomal-based depot morphine sulfate for post-operative pain management, and noted the current focus is on the delivery of siRNA using liposomes. Nucleotide-based drugs are easily degraded by enzymes, making it a serious challenge to successfully deliver them to a target site. This has fueled development in liposomes and also other nanoparticles to provide protection and targeted delivery of the nucleotides in hopes of producing a line of blockbuster drugs, founded on siRNA’s purported ability to target previously ‘undruggable’ targets.

For biologics, a key scalability issue is the tremendous amount of protein lost during the manufacturing process. New technology, such as Recoly is developing, could enable protein mixing with liposomes just prior to injection, potentially eliminating the problem. With diverse applicability and the potential to deliver different molecules, including up-and-coming biopharmaceuticals, biologic industry-watchers should explore technology developers in the liposomal field such as Keystone Nano, to-BBB Technologies, Rexahn, and NasVax (Client registration required) for potential opportunities.

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Comparing China’s Rising Contenders in Formulation and Delivery

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Formulation and delivery (F/D) is one of the main pillars of the biopharmaceutical industry, and as a science and technology, is becoming increasingly strategic and important to drug development success.

This week’s graphic comes from a recent Lux Research report (Client registration required) noting that, although Western pharmaceutical companies continue to enjoy historical technological and business advantages, a handful of promising Chinese companies are establishing the Asian giant as an emerging center for biopharma innovation and entrepreneurship in the F/D space. Comparing these players with their Western counterparts can be challenging, due to differences in geography, value-chain positioning, target applications and other factors. So, our recent report applies the proprietary Lux Innovation Grid, which offers an effective way to identify likely winners based common set of scoring metrics along business, technology and maturity.

China’s strongest challengers in F/D are focused on delivery devices, a subsector in which Lepu and Royal Fornia figure prominently. Both companies earned a spot in the “Dominant” quadrant and, according to the report, are poised to challenge their Western counterparts in the global market.

Lepu Medical Technology uses its expertise in nanomaterials to make interventional medical devices such as drug eluting coronary stents and other cardiology products. With 2011 revenues of $120 million, Lepu earns a spot in the Dominant Quadrant, but still lags Surmodics.

For its part, Surmodics, a U.S. based company specializing in device coatings and surface modifications, has a two decade head start on Lepu – which explains its relative position. But the company’s recent missteps regarding partnering and business development strategy led to the divestiture of its pharma unit – a lesson we expect Lepu and others to remember as they venture out on the global stage.

Royal Fornia Medical Equipment, also lands in the Dominant quadrant. It makes insulin pumps with computer-aided perfusion systems, enabling real-time monitoring and insulin dosage optimization. Royal Fornia enjoys a 30% market share in China and can parlay its 60% cost advantage to expand into other drug dosage optimization systems and other global markets.

Source: Lux Research report “The Expanding Formulation and Delivery Market in China.”

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