West Coast Editor

Less than two weeks after nailing down positive Phase IIa data with its drug for restless legs syndrome, XenoPort Inc. has filed for an initial public offering that targets $86.25 million in proceeds.

Neither the number of shares nor the price per share has yet been specified by the company, which is focused on the body's "natural nutrient transporter mechanisms to improve the therapeutic benefits of existing drugs," according to its IPO prospectus. XenoPort intends to trade on Nasdaq under the symbol "XNPT."

The lead product in the roster of Transported Prodrugs is XP13512, which is metabolized by the body to release gabapentin, a compound sold since 1993 by New York-based Pfizer Inc. under the brand name Neurontin.

Pfizer reported about $2.7 billion in worldwide sales of the drug in 2004. Despite its "substantial commercial success," XenoPort finds room for improvement, it said.

"Gabapentin absorption is highly variable among patients, and there is a limit on the gabapentin blood concentrations that can be achieved," XenoPort said in the filing. What's more, the quick disposal of the compound in blood after oral dosing means it must be taken three times a day, which can lead to poor compliance.

Earlier this month, XenoPort, of Santa Clara, Calif., said a 38-patient trial yielded improvement in objective sleep measures with XP13512 compared to placebo, with 29 patients describing themselves as "much improved" compared to five patients at the end of the placebo treatment period.

XP13512 also is being tested in a Phase IIa trial against post-herpetic neuralgia, or PHN, a chronic type of neuropathic pain that is a complication of shingles. XenoPort also plans to develop XP13512 for other neuropathic pain conditions, and the applications could be broad. In 2003, about 62.6 million patients were estimated to suffer from neuropathic pain in the U.S. and six other major pharmaceutical markets, XenoPort said.

Behind XP13512 in the pipeline is XP19986, a Transported Prodrug of R-baclofen, for gastroesophageal reflux disease, or GERD, and to alleviate the symptoms of spasticity.

Baclofen is sold as a generic drug for spasticity due to multiple sclerosis, stroke or cerebral palsy, as well as other pain and spasm conditions. XenoPort aims to file an investigational new drug application in the first half of this year, with Phase I trials to follow shortly thereafter. An IND is expected in 2006 for XP20925, the Transported Prodrug of propofol, for migraine and chemotherapy-induced nausea and vomiting.

As of Sept. 30, XenoPort had about $41.8 million in cash, cash equivalents and investments.

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