GelTex Pharmaceuticals Inc. reported positive Phase IIb results forits lead product Thursday to complete a string of good news theWaltham, Mass., company has had in recent months.

GelTex reported at a nephrology conference in Boston that RenaGel,which is designed to control elevated phosphorous levels in chronickidney failure patients, significantly decreased serum phosphorouswithout increasing serum calcium. GelTex plans to start two pivotalPhase III trials of the polymer-based drug by the end of the month,said Mark Skaletsky, president and CEO of GelTex.

Patients without kidney function can't process out excessphosphorous. But calcium-based treatments can lead to excesscalcium levels. RenaGel is designed to bind to phosphorous, whichcomes in through the diet, then eliminate it through the normalexcretion process.

GelTex's second product candidate, CholestaGel, acts in a similarway but the polymer binds to bile acids, thereby removingcholesterol. In March 1996 GelTex said a double-blind, placebo-controlled Phase IIa study of CholestaGel demonstrated a statisticallysignificant reduction in LDL cholesterol in patients with elevatedcholesterol levels. The company expects to begin a dose-refinementPhase IIb study next month, Skaletsky said.

GelTex was founded three and a half years ago. It currently has 33employees. GelTex sold 2.5 million shares at $10 apiece in itsNovember 1995 initial public offering. Early this month the companycompleted an offering of 2.5 million shares at $22.75 per share, anoffering that was expanded from the two million initially proposed.On Thursday Geltex said underwriters Cowen & Co. and Hambrecht& Quist LLC, both of New York, exercised overallotment options onanother 375,000, bringing gross proceeds to $65.4 million.

GelTex expects to spend less than $4 million per quarter goingforward. Currently it has about $91 million in cash.

"We're really excited with where we've been able to take thetechnology in a reasonably short time," Skaletsky said. "Then beingable to take the company public and do a secondary offering in a six-month time frame, and make our investors happy, puts us in a niceposition."

The Phase IIb study of RenaGel involved 48 chronic dialysispatients whose phosphate levels were being treated with calciumand/or aluminum-based binders. After a two-week washout periodpatients were treated with RenaGel. Doses were changed up to threetimes during the eight-week treatment period to achieve controlledserum phosphorous levels.

Phosphorous levels were decreased upon the start of RenaGel therapyand returned to baseline after four weeks. RenaGel also helpedcontrol hyperparathyroidism, and serum calcium levels remainedstable throughout the treatment period, the company reported.

One pivotal study, with 180 patients, will be designed similarly to thePhase IIb open-label, dose titration study. The second study willinclude 80 patients receiving RenaGel or calcium acetate. After eightweeks patients will be crossed over to the other treatment. Theprimary endpoint is control of serum phosphorous.

Skaletsky said GelTex plans to wait to partner RenaGel until after anew drug application is filed. GelTex also plans to find a partner forCholestaGel, but will wait until it can get maximum value in a deal. n

-- Jim Shrine

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