Editor

As a therapeutic indication, rheumatoid arthritis gets more love from investors, but another painful joint disorder has come to the fore as well, and Savient Pharmaceuticals Inc. is the company they talk about when they talk about gout.

An immune response causes off-and-on gout flares, triggered by too much bloodstream uric acid, which builds up in joints as well as tendons and kidney. A new approach has not emerged since allopurinol, approved in the mid-1960s. Allopurinol became the mainstay for lowering uric acid, and represents most of the prescriptions in the U.S. and Europe.

Otherwise, for pain, doctors are most likely to give a non-steroidal anti-inflammatory drug, such as indomethacin. And gout is painful. Very painful, often starting at the big toe.

Savient, using the often-deployed visual analog pain scale, asked patients to rate their discomfort from 1 to 10, on a ladder that starts with "annoying," proceeds through "dreadful," and ends at "agonizing," with several unpleasant stops between.

"They will always rate [gout pain] as 8, 9, or 10," said Paul Hamelin, senior vice president of commercial operations for Savient.

More than 30 percent of the population has hyperuricemia, which means they can't excrete all of the body's uric acid. Of those, about 1.4 percent end up with gout, characterized by uric acid above 6 mg per deciliter of blood.

"Allopurinol blocks the last step in the creation of uric acid," Hamelin said. "Typically, a patient might see their serum uric acid drop 1, 2 or 3 mg/dL."

Savient's Puricase does much better. An orphan drug designed for treatment-failure gout patients, the compound is a recombinant, pegylated form of modified porcine urate oxidase, the hepatic enzyme present in all mammals except humans, which converts the uric acid to allantoin, also known as 5-ureidohydantoin, a benign substance safely passed in urine.

In Phase II data, patients with uric acid levels of 9, 10, or 11 mg/dL were infused with 8 mg of Puricase, and had their acid levels drop "to almost negligible levels down to 1 mg/dL or zero," Hamelin said.

Savient last week finished the in-life portion of its two Phase III trials with Puricase, randomizing 110 patients into each trial, with a total of 212 getting at least one dose or Puricase or placebo, given once every two weeks or once every four weeks.

The Phase III program was designed under a special protocol assessment deal with the FDA.

There's an oral compound for gout making its way toward market: TAP Pharmaceutical Products Inc.'s febuxostat, a non-purine xanthine oxidase inhibitor licensed from Teijin Pharma Ltd.

"They filed [a new drug application] a couple of years ago," but the FDA had safety concerns, and TAP is repeating Phase III trials at a lower dose, Hamelin said. TAP is a joint venture between Abbott and Takeda Pharmaceutical Co. Ltd., and Abbott said in its earnings conference call last week that enrollment recently was completed in the 2,700-patient supplemental trial with febuxostat. A new filing is expected in the middle of next year.

"What we think will happen is that febuxostat will be an alternative to allopurinol, but we're going after those who can't take allopurinol" because of allergies or severe adverse events, Hamelin told BioWorld Financial Watch. Puricase's market comprises between 25,000 and 100,000 people in the U.S., where Savient plans to commercialize the product. Partners are being sought in other territories, where the company estimates about the same number of potential Puricase users.

Megan Murphy, analyst with Lazard Capital Markets, noted in a research report last week that almost all patients who completed the Puricase Phase III trials chose to enroll in the open-label extension.

"Puricase remains one of our favorite products in development in the space today, with favorable prospects for both regulatory and commercial success," Murphy wrote.

Stephen Dunn, analyst with Dawson James, set a $16 price target on Savient's stock, trading around $15 last week. The one-drug firm has an enterprise value of only $642 million, with $179 million in cash.

Dunn includes a 25 percent takeover premium in his model for Savient, which could attract buyout moves by the likes of GlaxoSmithKline plc, Bristol-Meyers Squibb Co., Johnson & Johnson, Wyeth and UCB.

Analyst Katherine Xu at Credit Suisse began covering Savient earlier this month, and cited Puricase's blockbuster potential and forecast a spring 2009 launch in the U.S., with peak sales of $480 million. Upside for Puricase could come in the form of market expansion into mild and moderate gout and "other gouty indications," Xu wrote in a report.

Leland Gershell at Cowen and Co. estimated revenue potential higher than $600 million for the compound.

Other firms in the gout space are farther behind. Regeneron Pharmaceuticals Inc. last month reported a 10-patient safety study with rilonacept showed a statistically significant reduction in pain scores.

The compound emerged from Regeneron's Interleukin-1 Trap technology, which captures target cytokines in the bloodstream before they can attach. IL-1 Trap mimics natural cell receptors by deploying the two components needed to bind the cytokines, which are then flushed from the body. After six weeks of therapy, 70 percent of patients achieved at least a 50 percent improvement in their pain scores, whereas none of the patients achieved a 50 percent improvement during the placebo run-in period. Separate efficacy measures also were improved, too, Regeneron said.

Also in September, the firm disclosed plans to start a Phase II study investigating the compound's worth in preventing acute flares of joint pain and inflammation caused by IL-1 in patients starting therapy with allopurinol.

Interim data are expected in the fourth quarter of this year. In early February, Regeneron reported Phase III data with the IL-1 Trap in CAPS (CIAS1-related autoinflammatory periodic syndromes), a family of rare autoinflammatory diseases, and Needham & Co. predicts a launch of the product in that indication during the first half of next year.

Altus Pharmaceuticals Inc. has ALTU-242 at the preclinical stage for gout, behind the lead candidate ALTU-237, a crystalline formulation of an oxalate-degrading enzyme to address a disease in which patients have too much oxalate. If a Phase I trial to be completed by the end of the year goes well, the path should be paved for the gout drug as well as ALTU-236, both of which take a similar approach to ALTU-237, and one of which is slated to reach the clinic next year. BioCryst Pharmaceuticals Inc. also has a preclinical program in gout.

Leader Savient finds itself in "a very comfortable position," Hamelin said, with cash that will take the firm through filing the NDA for Puricase and into the drug's U.S. launch.

"We don't have anything in preclinical development right now," he said, noting that the firm halted development of an early-stage drug to focus on Puricase. "We're out, we're looking, and we'd like to in-license other compounds."