PR Pharmaceuticals Inc. signed an exclusive agreement with OSI Pharmaceuticals to offer its ProPhase encapsulation technology to develop a sustained-release formulation of Macugen (pegaptanib sodium injection).

Macugen was approved in December 2004 to treat wet age-related macular degeneration. It is administered in a 0.3-mg dose once every six weeks by intravitreal injection.

"Getting an injection in your eyeball every six weeks is not pleasant," said Patrick Bols, president of Fort Collins, Colo.-based PR Pharmaceuticals Inc., a private biopharmaceutical company founded in 1998. "What we're doing is working on a formulation that is giving it a much more extended release time. So injections will be less frequent."

PR Pharmaceuticals (PRP) will be responsible for developing the formulations and manufacturing the test article for clinical and nonclinical trials. The ProPhase license gives OSI, of Melville, N.Y., and its partner, New York-based Pfizer Inc., rights to use the technology for Macugen to treat eye diseases. OSI's Eyetech eye disease unit will be responsible for all clinical development activities and has rights to manufacture and commercialize products.

PRP received an undisclosed up-front payment for the license, and is entitled to certain milestone payments and royalties, said Bols, who would not give further details. OSI also will reimburse PRP for research that supports the collaboration.

OSI acquired Macugen through its $935 million purchase of New York-based Eyetech Pharmaceuticals Inc. in November. (See BioWorld Today, Nov. 15, 2005.)

The acquisition is one that has been widely scrutinized by the financial community considering Macugen is a product that faces serious competition from South San Francisco-based Genentech Inc.'s Lucentis (ranibizumab). Lucentis has yielded better vision data than Macugen in two pivotal Phase III trials and beat Vancouver, British Columbia-based QLT Inc.'s product, Visudyne (verteporfin), in a comparison trial.

While analysts believe Macugen sales will be about $350 million in 2006, some expect sales will fall with the introduction of Lucentis, possibly to as low as $75 million in 2013. Macugen is a pegylated anti-VEGF aptamer that binds to vascular endothelial growth factor, a protein involved in angiogenesis and permeability, two processes that contribute to vision loss associated with neovascular AMD.

Lucentis is a humanized antibody fragment designed to bind to and inhibit VEGF. Genentech filed a biologics license application with the FDA for the drug in December to treat wet age-related macular degeneration. (See BioWorld Today, Jan. 3, 2006.)

The move to develop a sustained-release formulation of Macugen might be one way OSI and Pfizer intend to compete with Lucentis, which is administered once a month for three months. After the initial three months, as-needed dosing of Lucentis and dosing of once every three months for 24 months total are being evaluated in two separate Phase IIIb trials, called SAILOR and PIER.

Bols declined to say by how much PRP's technology could reduce the frequency of Macugen's injections, except to describe it as a "significant" reduction from the every-six-weeks regimen.

"Otherwise, we wouldn't go into this expensive process," he said.

The ProPhase technology is the encapsulation of pegylated molecules into a biodegradable matrix. It is incorporated in PRP's lead product InsuLAR, a once-a-week basal insulin injection in preclinical studies, but this is the first time that PRP has licensed the technology to an outside partner.

The agreement to use ProPhase with Macugen is a clear "recognition by a major pharmaceutical company like Pfizer" that the technology has potential, Bols said.

OSI's stock (NASDAQ:OSIP) fell 95 cents Wednesday to close at $28.01.