West Coast Editor
To bolster its pipeline of women's health products, Cellegy Pharmaceuticals Inc. said it has agreed to buy privately held Biosyn Inc., exchanging 2.5 million shares of Cellegy's shares for all of Biosyn's while paying off $3.25 million in Biosyn debt and contributing up to $15 million more when the latter's lead product, Savvy vaginal gel, is launched.
Michael Forrest, president and CEO of South San Francisco-based Cellegy, called Biosyn "an absolutely perfect fit," given his company's Tostrelle testosterone gel in the works for female sexual dysfunction and its plans for another product, Cellegesic.
Figured using Thursday's closing price of $4.25 for Cellegy's shares, the stock value of the deal is about $10.6 million, and the total value is up to about $28.9 million if approval milestones are met in the U.S. and elsewhere.
Cellegy's shares (NASDAQ:CLGY) ended Friday at $4.25, unchanged.
The company said it expects Biosyn's 20 or so employees to stay with the company at the Pennsylvania headquarters with Anne-Marie Corner, the firm's president and CEO, who will be named senior vice president of women's preventive health, reporting to Forrest. Cellegy also has about 20 staffers.
Biosyn's Savvy is a microbicide contraceptive gel to block HIV, and has shown activity suggesting it can protect against other sexually transmitted diseases including herpes, chlamydia, trichomonas, gonorrhea and syphilis. Two Phase III trials are under way in Africa for HIV prevention and a contraceptive efficacy Phase III study is ongoing in the U.S., with Cellegy planning to pursue more STD indications in later trials.
In Africa, the studies are comparing Savvy with a placebo gel in women using the gels for 12 months. The primary endpoint of the studies is a 50 percent reduction in the rate of HIV spread in the Savvy group compared with the control. A total of 4,400 patients will be enrolled in the two studies in Ghana and Nigeria. Cellegy expects both trials to be completed by mid-2006.
In the U.S., the contraception study has begun under the provisions of a special protocol assessment from the FDA and is designed to prove Savvy's non-inferiority to a currently marketed spermicidal gel.
Cellegy's most advanced product is Cellegesic nitroglycerin ointment (branded Rectogesic outside the U.S.), approved in the UK for pain associated with chronic anal fissures and expected to launch in the first half of next year. In the U.S., the FDA is expected to decide on the ointment's new drug application by May 2005. (See BioWorld Today, July 1, 2004.)
After the anal-fissures indication, Cellegy plans to pursue Cellegesic for hemorrhoids and dyspareunia, which is characterized by severe vaginal pain of an unknown cause. In the latter indication a Phase II dose-ranging study is under way in Australia. A pilot study at the UCLA Medical Center showed reduction of vaginal pain in more than 90 percent of the women taking part.
Forrest told BioWorld Today that using the gel against dyspareunia made some sense in a subset of patients with vaginismus - contraction in the lower third of the vaginal muscle - since the compound is a smooth-muscle relaxant, "but we weren't sure if it would work in overall pain relief."
Nitroglycerin is a nitric-oxide donor, so it's a neurotransmitter, he pointed out. Some scientists say that means it could have utility as a pain reliever, and "about half as many people will say there's nothing to it," Forrest said. But the UCLA results, though not placebo controlled, were compelling enough to move forward.
Set to enter Phase III trials "as early as the beginning of next year" is Cellegy's Tostrelle testosterone gel for sexual dysfunction in postmenopausal women.
Cellegy's therapies don't ignore male sexual health, either. Fortigel testosterone gel (branded Tostrex outside the U.S.), is undergoing regulatory review in Sweden for male hypogonadism caused by testosterone deficiency, and Cellegy is in discussions with the FDA to determine requirements for marketing approval here.
"We now have the makings of a very substantial women's health portfolio, one of the best I've seen around," Forrest said. "At the same time, Cellegesic is quite an exciting product in its own right," and the company will be looking to complement that compound with other late-stage products in the same area.
"We're not done with the gastroenterology field at all," he said.