By Debbie Strickland

Staff Writer

A California biotech-biotech collaboration has paid off with a new drug application for a neoplastic meningitis treatment that analysts say is a shoo-in for approval.

DepoCyt, an injectable, sustained-release formulation of the chemotherapeutic agent cytarabine, was developed by DepoTech Corp., a San Diego-based company specializing in drug delivery technology. Chiron Corp., of Emeryville, has signed on as marketing partner, with exclusive rights in the U.S., Canada and Europe, plus an option to market as many as three future DepoTech chemotherapeutic agents.

A key component of DepoCyt is DepoFoam, a proprietary lipid-based drug-delivery system created by DepoTech. DepoCyt, which an FDA advisory panel could approve as early as September, is the eight-year-old company's first and lead product, said CEO Edward Erickson.

DepoTech and Chiron could launch the drug — whose Phase III results indicate big gains in length of patient survival over the current standard treatment, methotrexate — as early as the fourth quarter. The company filed a partial NDA for DepoCyt in November. (See BioWorld Today, Nov. 27, 1996, p. 1.)

"The data are spectacular," said Marc Ostro, an analyst with UBS Securities, in New York. "If there was ever a sure thing at the FDA, this is it."

Analyst Mike King, of Vector Securities, in Deerfield, Ill., likewise characterized FDA approval as "a pretty easy decision."

Both analysts give DepoTech their highest rating and predict the company will show a profit next year.

"They'll have a commercial product," noted King, "and there aren't that many [biotechnology companies] that do. DepoTech will join what is still a pretty exclusive club."

Neoplastic meningitis is a usually fatal disease, occurring when metastases from solid tumors, leukemia or lymphomas spread to the tissue surrounding the brain and spinal cord.

DepoCyt's principal Phase III endpoint was complete response, as measured by a clearing of cancer cells from cerebrospinal fluid with no progression of the disease. Thirty-six percent of evaluable patients showed complete response with DepoCyt, a statistically significant improvement over the 21 percent rate in the methotrexate-treated control group. (Editor's Note: The results did not reach statistical significance for that endpoint. Other measures, such as time to clinical progression, did read statistcal significance.)

The drug also boosted the number of days patients were stable before the disease progressed to a mean of 126 days, more than four times the 39 days the controls averaged.

Mean patient survival was 215 days for the DepoCyt group, and 128 days for the controls. The disease-specific survival rate was 360 days, more than double the controls' 172 days.

The companies have launched a multi-center, Phase IV trial to fine tune the treatment, including the dosing regimen. A Phase I pediatric dose-finding study is underway for cases arising from solid tumors, leukemia and lymphomas.

Despite clinical trial successes, the company's stock has yet to reflect DepoTech's potential, noted Ostro, who boosted his recommendation on the company's shares to "strong buy" from "buy" earlier this month after reviewing the trials. A UBS report on DepoTech described the $185 million market value of its shares as "absurdly low."

The company's shares (NASDAQ:DEPO) closed Wednesday unchanged at $16.625.

DepoTech is also working on other applications of its technology, including DepoAmikacin, an antibiotic that has completed Phase I; and DepoMorphine, a post-surgical painkiller now in Phase I. The company has $30 million in cash on hand, with a burn rate of approximately $2 million per month.

As for Chiron, whose revenues last year topped $1.3 billion, DepoCyt marks a new addition to a lineup of cancer therapeutics marketed by its Chiron Therapeutics unit, including Proleukin, an injectable treatment for metastatic renal cell carcinoma which in trials as a skin-cancer treatment; and Aredia, a treatment for metastatic bone cancers that develop from breast cancer.

The company manufactures a line of generic chemotherapeutics, under whose umbrella DepoCyt has been developed.

The potential market for DepoCyt consists of neoplastic meningitis cases that result from solid tumors — some 80 percent of the 65,000 cases diagnosed each year. Kimberly Sankaran, a Chiron spokeswoman, declined to give additional marketing details.

Vector Securities estimates that the product will produce U.S. revenues of $6 million this year and $33 million in 1998, with world-wide sales hitting $138.7 million by 2001. *