Staff Writer

Shares of Altus Pharmaceuticals Inc. hit a new 52-week low of a penny on Thursday after the company revealed that it filed for Chapter 7 bankruptcy.

That's a far cry from the $25 per-share price Altus boasted just a few years ago, and it's a sad end for the Waltham, Mass.-based firm, which was founded more than 15 years ago as a subsidiary of Vertex Pharmaceuticals Inc. (See BioWorld Today, Jan. 28, 1993.)

Altus was tasked with developing Vertex's cross-linked protein crystal technology. Its lead product was an enzyme replacement therapy for cystic fibrosis patients, followed by a crystalline formulation of human growth hormone. The drugs attracted more than $100 million in venture money, not to mention government grants and $25 million from the Cystic Fibrosis Foundation. Altus raised another $105 million in its $15-per-share initial public offering in 2006. (See BioWorld Today, Jan. 27, 2006.)

Once public, Altus signed a potential $280 million deal for its growth hormone product with Genentech Inc. and raised another $88.5 million to fund Phase III studies with its cystic fibrosis drug. (See BioWorld Today, Dec. 21, 2006, and April 20, 2007.)

But then things started to go wrong. Disagreements over the development plan for growth hormone product ALTU-238 led Genentech and Altus to end their collaboration. Then top-line Phase III data for cystic fibrosis drug Trizytek (ALTU-135) turned out less robust than expected. (See BioWorld Today, Dec. 21, 2007 and Aug. 13, 2008.)

Although Altus received positive FDA feedback on Trizytek, it couldn't find a partner to finish the drug's development. Early this year, the company handed over Trizytek's rights to the Cystic Fibrosis Foundation, laid off 75 percent of its staff and refocused around ALTU-238 and earlier-stage programs. (See BioWorld Today, Jan 27, 2009.)

By the end of June, Altus had just $8.1 million in its coffers and little hope of raising more, thanks to the capital market meltdown. The company decided in September to eliminate substantially all of its remaining employees and begin the process of monetizing its assets. It sold its facilities and lab equipment to biochemical maker Boaopharma Inc. and filed for Chapter 7, also known as liquidation bankruptcy.

Altus' stock (NASDAQ:ALTU) closed at 8 cents on Thursday, a loss of 2 cents, or 20 percent, for the day. Thus a company that consumed somewhere in the range of $350 million came to rest with a market capitalization of about $2 million.

Yet some of Altus' legacy may live on. The company's protein crystallization pipeline may yet be acquired out of bankruptcy. Biotech and pharma scavengers recently have taken to picking any remaining morsels off the bones of failed biotechs: Ligand Pharmaceuticals Inc. picked up Metabasis Therapeutics Inc., Neurogen Corp. and Pharmacopeia Inc. that way, and Elitech Group got Nanogen Inc. during Chapter 11 proceedings.

Meanwhile, the Cystic Fibrosis Foundation found a new home for Trizytek. The drug, now known as liprotamase, was picked up by Alnara Pharmaceuticals Inc., a start-up founded by none other than Altus' former chief scientific officer Alexey Margolin. Final results and follow-up data from the now-completed Phase III trial will form the basis for a new drug application filing in the first quarter of 2010. (See BioWorld Today, Oct. 20, 2009.)