Sonus Pharmaceuticals Inc. filed a new drug application (NDA) lastweek for EchoGen Emulsion and qualified for another $7 million inmilestone payments related to development of the fluorocarbon-basedultrasound contrast agent.

Submission of the NDA triggered a $4 million milestone commitmentfrom U.S. marketing partner Abbott Laboratories, which already haspaid Sonus $15 million in milestones and $4 million for warrants.Sonus could receive another $16 million in milestone payments and$12 million in equity investments.

Japan-based Daiichi Pharmaceutical Co. Ltd., Sonus' EchoGenpartner in the Pacific Rim, recently agreed to pay Sonus $3 millionrelated to the successful completion earlier this year of a Phase II trialof EchoGen for myocardial perfusion.

EchoGen was tested in pivotal studies for its ability to enhance theclinical utility and cost-effectiveness of ultrasound procedures inradiology and cardiology. The Phase III studies involved 410 patientsat 33 U.S. sites. In both indications the product provided substantialbenefit in a number of endpoints.

Steven Quay, founder, president and CEO of Bothell, Wash.-basedSonus, said there are about 32 million procedures each year in theU.S. in which EchoGen could be used. Sonus is developing thecontrast agent for four additional indications _ breast and prostatecancer, central nervous system imaging and stress echocardiography.

"Those are areas where ultrasound is not being used very much,"Quay said. "Ultimately we think they could represent an additional 14million studies per year."

While Sonus has marketing agreements in place for the U.S. andJapan, the situation in Europe is not as clear. Sonus recently regainedmarketing rights from France-based Guerbert S.A. after Guerbertchose not to exercise an option agreement on the product.

Quay said the failure to reach agreement with Guerbert centeredprimarily around differences in the financial arrangement. "We'vealways felt the value of our product in Europe was appropriate at a 30percent royalty rate and a $34 million milestone package." He said apartner should be secured by the end of the year, the same time frameSonus is planning on filing for regulatory approval in Europe basedon the U.S. Phase III data.

Sonus is getting a 47 percent revenue split with Abbott, of AbbottPark, Ill., and will manufacture the product. It also will have atechnical marketing presence.

Quay said the NDA filing, "well ahead of our strategic plan targetdate, marks an important transition for Sonus into the small cadre ofyoung biopharmaceutical companies awaiting FDA approval of theirfirst drug."

-- Jim Shrine

(c) 1997 American Health Consultants. All rights reserved.

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