Less than a month after Affymax Inc. started the fourth Phase II trial of its lead product, Hematide, to treat anemia, the company signed a partnership deal in Japan worth up to $102 million.
Osaka, Japan-based Takeda Pharmaceutical Co. Ltd. agreed to develop and commercialize Hematide in Japan for anemia. The product is a synthetic, peptide-based, next-generation erythropoiesis-stimulating agent (ESA) expected to hit the U.S. market in 2010.
"Our strategy was to be able to get the Japanese deal done first to get the development accelerated," said Arlene Morris, president and CEO of Palo Alto, Calif.-based Affymax, who added that the company already is in discussions "on a rest-of-the-world partnership."
Under terms of the Japanese agreement, Takeda will make a $17 million up-front payment to Affymax and will purchase $10 million of Affymax’s stock. Affymax also may receive up to $75 million in clinical and regulatory milestone payments, as well as a double-digit royalty on sales in Japan. Takeda is covering all development and commercialization costs in the country and will manufacture the final commercial product, while Affymax is responsible for the manufacture and supply of the drug substance.
Hematide is designed to stimulate red blood cell production. In January, it entered a trial evaluating its use in anemia in cancer patients. The drug also is being evaluated in a Phase IIb trial in hemodialysis patients with end-stage renal disease, as well as a Phase IIb trial in chronic kidney disease patients who are not on dialysis and who have not been previously treated with erythropoietin. Results from an earlier Phase IIa study of Hematide in patients with chronic kidney disease are expected at a scientific meeting early this year. The trials are being conducted in the U.S. and Europe.
Morris estimates that the oncology program is about nine to 12 months behind the renal disease program, which should move into Phase III trials in the U.S. by the first quarter of 2007. A regulatory filing could occur about two years later with marketing approval currently expected for 2010.
ESAs represent a $12 billion market worldwide and as much as a $1 billion market in Japan.
"Right now," Morris told BioWorld Today, "these products are only approved for renal diseases."
ESA therapy has reduced the need for blood transfusions, as well as the frequency and severity of anemia-associated morbidity. Morris believes there is a significant upside in sales from the current figures if Hematide receives clearance for use in oncology indications, adding that "we could see continued growth from most of the predialysis area," as well.
Hematide’s potential competitors include Procrit and Aranesp, developed by Thousand Oaks, Calif.-based Amgen Inc. But "the market is switching to long-acting products," Morris said, and "away from multiple injections," which may give Hematide an advantage over competitors. It is dosed once a month, instead of every two weeks.
The product also has an amino acid sequence that is unrelated to erythropoietin, a hormone that stimulates red blood cell formation, or any other known naturally occurring human sequence. It is, therefore, unlikely to generate antibodies to natural erythropoietin.
Other advantages of peptide-based drugs are reduced immunogenicity, improved dosing convenience, flexible storage and improved manufacturability.
Affymax intends to initiate a fifth Phase II study of Hematide early this year in patients with pure red cell aplasia. The company also is working on Hematide analogues for tissue protection, and it has active research projects for novel peptides that compete with the natural ligand for binding to target receptors. At the most advanced stage of research, it is looking at peptide-based agonists of the granulocyte colony-stimulating factor receptor and of the keratinocyte growth factor receptor.
In 2004, Affymax formed a research collaboration with Rockville, Md.-based EntreMed Inc. for the synthesis and development of novel peptides that prevent blood vessel formation in tumors. (See BioWorld Today, Oct. 27, 2004.)
The company last raised $60 million in a Series D round conducted in July 2005. (See BioWorld Today, July 19, 2005.)
While Affymax always is looking at the public markets, it does not need to do another financing anytime soon. The deal with Takeda should support its operations for a while.
"This gives us another flood of cash to take us a little bit further," Morris said, "and hopefully, we’ll get a rest-of-world deal done in the second half of this year."