HONG KONG – Shenzhen-listed Harbin Gloria Pharmaceuticals Co. Ltd. plans to acquire a major stake in insulin maker Hefei Tianmai Biotechnology Development Co. Ltd. (HTBT) for ¥4 billion (US$600 million). Gloria is after HTBT's lead product, an oral insulin being co-developed with Israeli company Oramed Pharmaceuticals Inc.
Orally administrated insulin drugs would be a game-changing treatment for diabetes if successfully developed. Danish pharma giant and major global diabetes player Novo Nordisk A/S has even hailed oral insulin as "the missing piece of the puzzle."
But developing oral insulin is a fierce game as drugmakers face enormous technological hurdles and capital requirements. In October 2016, Novo Nordisk halted its plan to bring a drug to the market, saying oral insulin was deemed commercially nonviable under its development program.
Forerunner in oral insulin
With the main competitor dropping out of the game, Oramed and HTBT could be the first in the world to complete the puzzle.
"Currently, our oral insulin capsules have completed the phase IIb clinical trial in the U.S. and will soon start the phase III international multicenter clinical trial in China," said HTBT. According to Oramed, the compound, ORMD-0801, is in development for type 1 and type 2 diabetes and has the potential to be given at earlier stages of diabetes, potentially slowing disease progression as well as delaying or even eliminating late-stage complications.
Since 2007, HTBT has been developing recombinant human insulin, insulin analogue and finished products. Three years ago, it decided to take a step further to make insulin an oral drug.
"In late 2015, we signed an agreement with HTBT for the licensing rights of the oral insulin in China," Estee Yaari, communications officer at Oramed, told BioWorld Asia. The two companies leveraged Oramed's protein oral delivery technology.
"Oral delivery has a number of potential benefits, including better patient compliance, earlier intervention, and a delivery that more closely mimics the natural path of insulin in the body by going through the gastrointestinal tract via the liver and then into the bloodstream," said Yaari.
"This method of protein passage through the digestive system is more natural and should therefore eliminate the many side effects of delivery via needle directly into the bloodstream," he added.
Promising as it might sound, developing oral insulin is not an easy task. Oramed said the integrity and potency of orally ingested proteins could be undermined by harsh acids and proteolytic enzymes within the gut and by the physical barrier posed by the wall of the small intestine, which blunts translocation of large particles.
Oramed's technology solves it by creating a protective coating for capsules, encapsulating active protein to keep them intact in the most acidic segments of the gut, as well as providing enzymatic support with specialized protease inhibitors. Drug availability is further secured by an absorption enhancer supplement that facilitates protein passing across the intestinal barrier.
Breaking the monopoly
As the global insulin market is expected to approach $40 billion by 2020, oral insulin capsules could mean huge profits, especially when the Chinese insulin market is currently dominated by Novo Nordisk, Eli Lilly and Co. and Sanofi SA.
Gloria's generous offer of $600 million to HTBT demonstrated the company's determination to tap into the insulin sector, as HTBT only generated ¥1.5 million (US$225,000) in revenue for the 2017 financial year.
But the oral insulin is expected to make up for that later – HTBT promised to bring ¥1.8 billion (US$270 million) of total net profits between 2018 and 2020.
Gloria explained in its stock market notice that the reason it still bets on HTBT despite its lack of revenue is because "HTBT is still in the R&D stage, thus its revenue was not significant in 2017. But as the company obtained the approval for its recombinant human insulin injection in April and has a competitive insulin pipeline, its revenue is expected to surge."
This is also a move by Gloria to enrich its portfolio of oral drugs that target a wider range of chronic diseases.
The listed pharma company saw rapidly growing sales of its oral drugs for chronic diseases in 2017, representing 26 percent of its total revenue compared to just 15 percent in 2015. Its blockbuster cardiocerebral vascular drug clopidogrel bisulfate tablets saw sales growth of 63 percent.
Founded in 2000, Beijing-based Gloria has a wide ranging portfolio covering therapeutic classes in cardiovascular, vitamins and minerals, endocrine, infection, oncology, urinary, digestive and respiratory.