Rubbing allantoin's lamp: Amicus Scioderm buyout worth as much as $847M
By Randy Osborne
Amicus Therapeutics Inc. CEO John Crowley told BioWorld Today his firm won't be the only company working on a therapy for the rare skin disorder epidermolysis bullosa (EB), but the potential $847 million takeover of privately held Scioderm Inc. to bring aboard phase III Zorblisa means a handsome lead over the competition. "There are some other programs and technologies in development, but they're all very early stage, and ours is the only one that would address all subtypes of EB," he said.
Zorblisa, a topical cream for the genetic connective tissue disorder, could be worth $1 billion worldwide. In the deal, Durham, N.C.-based Scioderm's shareholders are collecting $229 million at closing, which includes $125 million in cash and $104 million shares newly issued by Amicus, of Cranbury, N.J. Another $361 million to Scioderm could be due if clinical and regulatory milestones are achieved, and $257 million more if sales goals are met.
Given breakthrough and orphan status by the FDA, Zorblisa could win a priority review voucher (PRV) because EB qualifies as a rare pediatric disease. If the FDA grants one and the PRV is then sold, Amicus will pay Scioderm shareholders the lesser of $100 million or 50 percent of the proceeds.
The drug's active ingredient is allantoin, a nitrogenous compound used in skin-care products. Jay Barth, chief medical officer of Amicus, said during a conference call with investors that "without going into the proprietary nature of the formulation, a challenge really has been to increase the concentration of allantoin to the point where it's stable and soluble, and gets into the skin through the appropriate layers but not absorbed. And the technology, which I'm not able to discuss right now, does enable Zorblisa to do that with allantoin at a high concentration to provide that benefit."
EB causes fragile skin that blisters and tears from minor friction or trauma, causing severe complications and a very early death for many children. The current standard of care is palliative treatment that costs $10,000-$15,000 per month, mostly for bandages, and treating the open wounds to prevent infection while trying to manage patients' pain. About 30,000-40,000 people are diagnosed with EB in major markets, Amicus said.
In July, Exton, Pa.-based Fibrocell Science Inc. and collaborator Intrexon Corp., of Germantown, Md., submitted an investigational new drug application to the FDA for FCX-007, a gene therapy candidate to treat recessive dystrophic EB. Another player, Lotus Tissue Repair Inc., of Cambridge, Mass., agreed in 2013 to be acquired by Dublin-based Shire plc for an undisclosed up-front payment and certain contingent payments based on the achievement of safety and development milestones. Lotus was developing a protein replacement therapy for dystrophic EB. That program within Shire is "still preclinical," Crowley said. (See BioWorld Today, July 21, 2015.)
DISORDER 'JUST BRUTAL'
Junctional "is the most severe" form of EB, Crowley said. "There, you're getting internal organ involvement. Often, those babies don't live very long." Dystrophic, or recessive dystrophic, is the next most-severe form of the disease, causing "very severe disfigurement" along with pain and blistering. Simplex affects about three-fourths of EB patients, who "tend not to be covered over their entire bodies" with wounds.
Expected to support registration globally, Scioderm's – soon to be Amicus' – phase III multicenter, randomized, double-blind, placebo-controlled study with Zorblisa, called SD-005, is under way in the U.S. and Europe. Enrolling are patients 1 month and older with a diagnosis of simplex, recessive dystrophic, or junctional non-Herlitz EB who have at least one target wound present for 21 days or more.
Half the patients are getting Zorblisa cream (also known as SD-101) and the other half receive placebo, applied once daily to the entire body for 90 days. The primary outcome measure is complete target wound closure within two months. Secondary outcome measures include median time to complete target wound closure, change in lesional skin at the second month, change in itching at the seventh day, and change in pain at the seventh day. Patients who complete the 90-day primary treatment period will be eligible to receive Zorblisa in an open-label extension study (SD-006).
The phase III trial "began in the second quarter," Crowley said. "It's about a third or so enrolled," and should complete enrollment in the first half of 2016. "Since it's only a two-month endpoint, we would expect to have data sometime later in the first half of 2016," he said. The drug has been designated orphan and breakthrough therapy with a rolling NDA "already agreed to a couple of months ago," which "will begin under Amicus' watch, early in the fourth quarter."
Scioderm based the later-stage experiment on a subgroup analysis of a phase IIb study in which the higher, 6 percent concentration dose worked best in healing larger baseline wounds. "The separation was almost immediate from placebo" in the phase IIb trial with the 6 percent dose, Crowley said. "When it came time to design the phase III, the company worked very closely with the FDA," deciding that "baseline wounds need to be of a significant enough size that they would measure true change, so it would minimize any placebo effect." The size decided upon is 10 cm, "which is still pretty small," he said, but "these kids are typically just covered in these wounds. It's like they're living with a third-degree burn across much of their bodies for their entire lives. It's just brutal. In every case, it's a serious disease. There's no such thing as a mild form of EB."
Amicus shares (NASDAQ:FOLD) closed Monday at $14.35, down 52 cents.
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