By KEVIN DAVIES
How does the CEO of a four-year-old Canadian biotech secure the largest private financing deal of 2004 and garner an Ernst & Young entrepreneurial award ... without discovering a single new drug? By turning the traditional pharmaceutical partnering model on its head.
Richard Glickman launched Aspreva Pharmaceuticals in 2001 with Noel Hall and Michael Hayden, professor of genetics at the University of British Columbia in Vancouver. Hayden serves as chief medical
Typically, small biotechs hope to convince a big pharma to license drug prospects and burden the expense of clinical trials. However, in many cases a big pharma may shelve a drug application because it deems the potential market too small.
Hayden says the concept for matching diseases with existing drugs “arose from the recognition and frustration I had in dealing with patients with genetic illnesses where ... the pharmaceutical companies didn’t want to invest sufficiently to do a clinical trial in an effort to develop the compound.”
Several years ago, Hayden conducted a small trial for Huntington’s disease using a drug for another disease that produced “massive symptomatic relief.” Patients even continued buying the drug after the trial ended, but the drug company declined to run a larger trial.
Another respected Canadian geneticist, Charles Scriver, was similarly frustrated a few years later. He turned to a Swedish orphan drug company when he was unable to find a sponsor for a promising drug for phenylketonuria.
Sensing an opportunity, Hayden, Glickman, and Hall formed Aspreva — the name derives from spero (“hope”) and aspero (“aspirations”) — hoping to find drugs for less common illnesses with enough anecdotal proof to warrant a clinical trial. Hayden says, “We hired some researchers to help us, and came across a Roche drug called CellCept. It’s the number one drug for transplantation.”
Aspreva discovered encouraging data from various small clinical trials for autoimmune disorders such as myasthenia gravis and lupus, which affects at least 500,000 Americans. The last drug approved for lupus, the steroid cyclophosphamide, was synthesized more than 40 years ago and can produce serious side effects — notably, reproductive failure, especially in African-American women. “There was no understanding of ethnic responses to drugs,” Hayden says. “CellCept appeared to overcome that barrier.” (In September, the FDA rejected Riquent, a lupus drug, sinking shares of La Jolla Pharmaceutical more than 50 percent.)
There was just one problem. “Why would Roche give three well-meaning guys — charming, maybe — on the West Coast its drug?” Hayden asks. (Particularly one that earns Roche $1.5 billion in sales annually.) “So we bought suits, cashed in our frequent-flyer points, and the three of us went to Basel (Switzerland).”
Hayden presented new data from Ellen Ginsler, who had received FDA permission to study CellCept for lupus nephritis. “We said, ‘There’s an opportunity for a pharma with vision,’” Hayden recalls, warning Roche of a pending crisis just like the AIDS crisis and the pricing crisis. “When patients with rare illnesses start realizing you’re not willing to do a trial because they don’t fulfill a rubric, the PR impact will be dramatic.”
The Canadians coined the phrase “social equity,” telling Roche they could build the equity of the company as a social organization and “we won’t cost you a cent. We’ll take the drug, and we’ll share the upside. You focus on the primary market; we’ll take care of everything else.”
In 2003, Aspreva secured worldwide rights for CellCept for conditions except transplantation, until 2020. Aspreva has a close partnership with Roche, jointly preparing the regulatory filings. “We make sure Roche is getting the recognition as this visionary company,” says Hayden. Trials for lupus, myasthenia gravis, and pemphigus vulgaris are ongoing. Multiple sclerosis might be another disease target.
Aspreva has set up a European base in Bagshot, England. This fall, Hayden and colleagues were feted by the Lupus Foundation in Washington, D.C., featuring celebrities including the runner-up in America’s Next Top Model, Mercedes Scelba-Shorte, who has lupus.
Aspreva closed its IPO in early March, raising $79 million, with Merill Lynch leading the underwriting. The company is searching for more drugs that fit the rubric — “a particular niche where the drug has shown low toxicity, and where it’s under the radar for the company for these indications.”