Editor

LSD, still best known as the acronym for the once-popular hippie drug lysergic acid diethylamide, also is recognized to stand for something else in the pharmaceutical world. And that something may be just what the doctor ordered for those who regard profits in these hard times as nothing more than hallucinations.

Analysts and investors are talking a lot these days about the ailments that fall into the class of the "other" LSD, lysosomal storage disorders. These are about 40 different illnesses, typically inherited and each earmarked by the shortage of a specific lysosomal enzyme.

In scientific terms, lysosomal enzymes help with the intracellular degradation of macromolecules to low-molecular-weight compounds, and deficiencies of such enzymes cause the buildup of undegraded macromolecules within the saclike organelles known as lysosomes, which then leads to disease.

Put more simply, in the case of the LSD called Fabry's disease, for example, a shortage of the enzyme alpha galactosidase A (also known as ceramidetrihexosidase) causes a buildup in the body's blood vessels of the fatty substance globotriasylceramide.

That's bad. It can be very bad, starving tissues of blood supply and affecting the skin, kidneys, heart, brain and nervous system. Although Fabry's disease patients seldom die early, they are at greater risk of strokes, heart attacks and kidney damage.

The gene that goes wrong in Fabry's is on the X chromosome, which means only the mother needs to carry it in order to bear a child who's affected. Her son is at 50 percent risk of having the disease, and her daughter at the same risk of being a carrier.

An estimated one in 120,000 males get Fabry's disease. Patients usually are diagnosed in their late 20s, as they begin to show poor kidney function or angiokeratomas (vascular skin conditions), and the family pedigree is explored. The worldwide Fabry's disease market is estimated at around $1 billion.

Making headlines for their work in Fabry's disease have been Genzyme General and Transkaryotic Therapies Inc., with Fabrazyme (agalsidase beta) and Replagal (agalsidase alfa), respectively, involved in a closely watched race for approval.

Developments in that contest came just over a week ago when the FDA's Endocrinologic and Metabolic Drugs Advisory Committee put off its meeting to consider the two drugs, which had been scheduled for Sept. 26 and 27.

TKT declared in a press release that the FDA had delayed the meeting for "administrative reasons." Genzyme said in a press release it was "opposed" to the delay, remarking that "a concern was raised about the composition of the advisory committee." Details from either side were scant.

It turned out that TKT had objected to four experts on the roster to answer questions from the panel. Although the experts had no vote, TKT didn't like their experts' financial ties to Fabrazyme, said Buddy Lyons, vice president and biotechnology analyst with Morgan Keegan & Co. in Memphis, Tenn.

"We talked to TKT's chief financial officer, and they said some people [advising] the panel who had some experience and had worked with Genzyme," Lyons told BioWorld Financial Watch. "I assumed he meant they had worked with Fabrazyme, so TKT didn't think they could be totally objective."

Given the small community of enzyme-replacement researchers, he added, finding people with no links to either company might be a challenge. The next meeting of the committee will be held Dec. 5 and 6. Will the FDA take up the matter then? "Nobody has a clue," Lyons said.

Both drugs already are approved in Europe, with Replagal taking about 60 percent of the market outside the U.S.

"Our basic thesis is that Replagal has better data," Lyons said. "We could argue over trial size, but it clearly has a better side effect profile. If they did both get to market, we think Replagal would do better in the U.S. like it has in Europe."

Genzyme, he added, "has a big toehold in France, and that's where most of their business is coming form right now. You'll see that market share spread out over time. Even if the drugs were equal, which I don't think they are, do you want to hook patients up for two to five hours or 40 minutes? That's a big selling point, because treatment has to be done weekly or biweekly."

Intrigue over Fabry's disease treatments aside, the ripeness of the entire LSD realm may have been overlooked, noted analyst Yaron Werber with SG Cowen Securities in a research report on the space. Lyons agreed.

"It's a high-dollar area where a lot of revenue can be generated with a small patient population," he said. "Genzyme right now is generating $550 million off 3,000 patients." Of the 40 LSDs, he said, "I've heard estimates that say between 12 and 20 probably are commercially viable."

Some much-publicized progress is being made. In September, Genzyme and partner BioMarin Pharmaceutical Inc. said the FDA accepted the biologics license application for Aldurazyme - an enzyme replacement therapy for mucopolysaccharidosis 1, also known as MPS I - and granted it six-month priority review status. An application was filed in Europe in March.

And no one is forgetting Genzyme's Cerezyme (recombinant glucocerebrosidase, also known as imiglucerase) for Gaucher's disease. Of about 5,000 patients with this LSD worldwide, about 3,400 are getting Cerezyme, and sales have been estimated at about $614 million for this year.

It was Genzyme's natural version of the enzyme, called Ceredase (which was developed first) that piqued interest in the possibilities offered by the treatment area. Although inventing the drugs is hardly simple and surrogate markers questionable for proving efficacy, LSDs as a class have benefits. They can get orphan drug status for market exclusivity, for example, and patients visit localized centers for their drugs so the sales effort need not be massive and widespread.

TKT also has a Gaucher's drug in the works, but a more immediate contender to Genzyme's market lock is Oxford GlycoSciences plc's glucosyltransferase inhibitor, Zavesca (previously known as Vevesca), which was approved in Europe in late July, when OGS also signed marketing partner Actelion Ltd.

Launch in Europe, where the number of patients has been estimated at only 250, is expected early next year, and OGS hasn't been so fortunate with Zavesca stateside. The FDA turned down the drug in June, citing safety concerns as well as some regarding clinical efficacy. More trials are likely.

TKT, meanwhile, is expected to start a pivotal study by the end of the year with iduronate-2-sulfatase, an enzyme replacement therapy for the treatment of Hunter syndrome (or MPS II), another LSD. The treatment has been given orphan drug status in both Europe and the United States. TKT has some strong intellectual property related to the gene coding for I2S, and could file a biologics license application as early as 2004.

But the big LSD prize may yet end up going to Genzyme, which has a deal with Synpac Inc. to develop enzymes for Pompe's disease, although Genzyme now is developing its own product in-house

This spring, the firms' joint venture with Pharming Group NV, called Genzyme-Pharming Alliance LLC, started a Phase II/III trial in Europe and the U.S. in infants, and about a year ago Genzyme acquired Novazyme Pharmaceuticals Inc. for $137.5 million in stock, thus acquiring its early stage candidate, NZ-1001, for Pompe's disease. The joint venture with Pharming has since ended.

But, at the moment, industry watchers are cheering from the sidelines for their respective "teams" in the Fabry's war between Genzyme and TKT.

"These companies absolutely hate each other, and it's become almost like a sporting event," Lyons said. "Right now, given the frame of mind the FDA has been in the last 12 to 18 months, safety is going to be a big deal, and that may carry the day," with Genzyme's side effect profile handicapping its drug.

"[Wall Street] is divided on it," he said, and he is "not a lone wolf" in favoring TKT. Theoretically, both treatments could win approval as orphan drugs - although one or both companies might then file a lawsuit against the FDA, Lyons said.

"We're [predicting] either a co-orphan status, or TKT" winning the nod alone for Replagal, he said. "We don't think TKT will be shut out."