West Coast Editor

Although still trading at under a dollar, Unigene Laboratories Inc. saw its stock jump 63 percent on news that GlaxoSmithKline plc signed a licensing deal worth up to $150 million for an oral parathyroid hormone (PTH) analogue still in preclinical studies for osteoporosis.

“That’s unusual for them,” said Ronald Levy, executive vice president of Fairfield, N.J.-based Unigene. “They wouldn’t come in this early unless they saw this as a sterling opportunity.” Glaxo, he added, “wants to begin the tech transfer today, but we might have to wait a little bit longer.”

Unigene’s stock (OTCBB:UGNE) closed Monday at 88 cents, up 34 cents, or 63 percent.

Under the terms of the deal, Unigene gets an up-front payment and milestones plus royalties in exchange for an exclusive worldwide license to London-based Glaxo for developing and commercializing the compound. Glaxo also will underwrite all development activities during the program, including the production of raw materials needed.

Levy attributed the pharmaceutical giant’s eagerness to Unigene’s combination of oral delivery technology and manufacturing capability.

Many firms boast of the latter, Levy noted, but “very few of those [claims] are real, and that’s what Glaxo told us the first time we talked. Even if you do have a good oral delivery system, it’s by nature very inefficient, because of the long, circuitous route to get into the bloodstream. You have to put more of your active ingredient into the pill because more of it gets broken down which in turn raises your cost, so you need a manufacturing technology that can scale up to high levels cost effectively.”

Unigene’s experiments with calcitonin, a naturally occurring peptide hormone against osteoporosis, proved its technology protected the peptide from digestive acids and enzymes, thus helping it enter the bloodstream, and the same technology works with PTH, Levy said.

“[PTH] actually builds back new bone,” he told BioWorld Today. “All the osteoporosis treatments approved to date are in the class of antiresorptive agents. They slow the rate of bone loss, but that’s only part of the equation.” Unigene’s version has shown in early tests that it reduces the incidence of new fractures “to a level that was significantly greater than any of the currently marketed antiresorptive products,” Levy said.

Also starting with calcitonin, Unigene devised a patented manufacturing process for making peptides on a large scale using its proprietary amidating enzyme in the fermentation-based system. Unigene has launched its injectable calcitonin in the European Union, and established a joint venture to sell it in China. The company is developing a nasal version and an oral formulation of the compound, too.

Regarding the PTH analogue, Indianapolis-based Eli Lilly & Co. has an injectable version, called Forteo, for which a new drug application is under review by the FDA.

“It’s the only PTH product that’s come that far,” Levy said.

Early studies of an oral formulation are under way with Emisphere Technologies Inc., of Tarrytown, N.Y., he acknowledged. It showed promising results in animal models last summer, Emisphere reported.

Also working on an injectable version is NPS Pharmaceuticals Inc., of Salt Lake City, which said late last year it would expand patient enrollment in its Phase III study of what the company calls ALX1-11, and would start a new study in women receiving hormone replacement therapy.

“They have the full, 84-amino-acid molecule,” Levy said. “I don’t think there’s anyone else interested in doing anything with the full-length molecule.” Anyway, the oral version holds the most promise, given the frequent dosing regimen and patients’ dislike of shots, in Levy’s view.

An estimated 35 million people worldwide suffer from osteoporosis. They’re only getting older, and aging baby boomers in the U.S. are sure to increase the need here.

“The market is tremendously robust and rapidly growing,” Levy said.