Connective Therapeutics Inc.'s strategy of in-licensing promising orapproved drugs that can be brought to market quickly in newindications is beginning to pay off as it enters Phase III studies with aproduct it acquired only nine months ago.

The Palo Alto, Calif., company this week began a Phase III trial withgamma interferon for atopic dermatitis, a potentially disfiguring skindisease characterized by redness, swelling and itching.

The drug, a lymphokine involved in regulation of the immune system,was licensed in December 1995 from Genentech Inc., of South SanFrancisco, which markets gamma interferon for chronicgranulomatous disease and which conducted Phase I and Phase IIstudies in atopic dermatitis.

Connective Therapeutics is slated to begin this year another study, aPhase II trial, of gamma interferon for treatment of keloids, which areenlarged scars caused by excessive collagen buildup during healingof connective tissue.

In June, the company began a Phase II trial of relaxin forscleroderma, which is characterized by a thickening of skin andinternal organs.

Relaxin, a peptide hormone that promotes remodeling of connectivetissue, is another product licensed from Genentech. A second PhaseII study of relaxin for another fibrotic indication is planned for 1996.

Connective Therapeutics also is developing T-cell receptor (TCR)peptide vaccines for multiple sclerosis and rheumatoid arthritis. Thevaccines are based on technology licensed from three sources _Genentech, Xoma Corp., of Berkeley, Calif., and the University ofOregon Health Sciences Center in Portland.

The TCR peptide vaccines are designed to attack autoimmunediseases that affect connective tissues by boosting the immunesystem's natural control of T-cell responses. A Phase I/II study formultiple sclerosis and a Phase I trial for rheumatoid arthritis areexpected to begin this year.

Connective Therapeutics' latest product acquisition in June 1996 wasbetamethasone mousse, which was licensed from Soltec Research PtyLtd. in Melbourne, Australia. The mousse formulation of thecorticosteroid, betamethasone valerate, is on the market in the U.K.for scalp dermatitis. Betamethasone valerate is sold in the U.S. fordermatitis.

Richard Hammel, Connective Therapeutics' vice president ofcommercial development, said the company's strategy focuses onbringing products to market for dermatology and rheumatology. Bothinvolve connective tissues, the main field of expertise for one of thecompany's founders, Edward Amento, the chief scientific officer andformer head of Genentech's rheumatology research program.

"We have two core competencies," Hammel said, "development andcommercialization."

In-licensing products that have undergone preclinical and earlyclinical evaluations elsewhere reduces costs and risks of bringingdrugs to market.

Relaxin was the first product acquired by the company. Hammel saidpreclinical studies showed the drug affects connective tissues in threeways. It downregulates production of collagen, he said, upregulatescollagenase _ an enzyme that breaks down collagen _ anddownregulates a protein that blocks collagenase. Collagen is a keycomponent of connective tissue.

"Relaxin," Hammell observed, "is three to five years away from themarket."

So Connective Therapeutics went after other products, such asgamma interferon, to establish more quickly a market presence forthe company.

The Phase III double-blind, placebo-controlled trial of gammainterferon will enroll 525 patients and take 12 weeks to complete.Data are expected to be released in the third quarter of 1997 withsubmission of a marketing application with the FDA to follow.

In the Phase III study, patients will be divided equally into a placeboand two treatment groups. Those receiving the drug will getinjections either daily or every other day. All patients will receive thesame dose.

Long-term evaluations of patients in the Phase II trials showed thatthose who took the drug for a year experienced a 35 percentreduction in dermatitis covering their skin. Other patients whoreceived gamma interferon treatments for two years saw a 24 percentreduction in disease area.

Connective Therapeutics (NASDAQ:CNCT), which went public inFebruary 1996 at $11 per share, closed Thursday at $7, up 50 cents. n

-- Charles Craig

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

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