| Santarus, Inc. (From S-1 3/9/2004)
We are a specialty pharmaceutical company focused on acquiring, developing and commercializing proprietary products for the prevention and treatment of gastrointestinal diseases and disorders. The primary focus of our current efforts is the development and commercialization of next generation proton pump inhibitor, or PPI, products the most frequently prescribed drugs for the treatment of many upper gastrointestinal, or GI, diseases and disorders. The PPI market, including five delayed-release PPI brands, had U.S. sales of $12.9 billion in 2003, according to IMS Health, an independent pharmaceutical market research firm. Also, according to IMS Health, total U.S. prescriptions for PPIs grew from 86.3 million in 2002 to 95.2 million in 2003 a 10% increase. We submitted our first new drug application, or NDA, in August 2003 for RapinexTM powder-for-suspension 20mg and our second NDA in February 2004 for Rapinex powder-for-suspension 40mg, which are immediate-release formulations of omeprazole, a widely prescribed PPI currently available for oral use only in delayed-release formulations.
Product Candidates
Our current three product candidates, Rapinex powder-for-suspension, Rapinex capsule and Rapinex chewable tablet, are proprietary immediate-release formulations of omeprazole. These product candidates are intended to treat or prevent a variety of upper GI diseases and disorders including heartburn, gastroesophageal reflux disease, or GERD, erosive esophagitis, or EE, upper GI bleeding and peptic ulcer diseases. PPIs enjoy widespread use due to their potent acid suppression, demonstrated safety and once-a-day dosing. However, all currently marketed PPIs are available for oral use only in delayed-release, enteric-coated formulations. While the enteric coating protects the PPI from acid degradation, it also results in a delay in the onset of action. We believe that our product candidates will provide rapid reduction in gastric acidity, while maintaining a therapeutic effect and duration similar to delayed-release PPIs, and so will be desirable to physicians and patients.
Our first product candidate, Rapinex powder-for-suspension, is immediate-release omeprazole in a powder-for-suspension formulation which utilizes an antacid instead of an enteric coating to protect the omeprazole from acid degradation. The antacid rapidly neutralizes acid in the esophagus and stomach which allows the immediate release of omeprazole into the bloodstream that we believe will provide rapid reduction in gastric acidity and sustained heartburn relief. The powder-for-suspension formulation may be particularly desirable for hospitalized patients, children and the elderly, who may prefer or require a liquid formulation.
We submitted our first NDA for Rapinex powder-for-suspension in a 20mg dose in August 2003 and are seeking initial indications for the treatment of heartburn and symptoms related to GERD, treatment and maintenance of healing of EE, and treatment of duodenal ulcer, or DU.
We submitted our second NDA for Rapinex powder-for-suspension in a 40mg dose in February 2004. This NDA seeks approval for Rapinex powder-for-suspension 40mg for the prevention of upper GI bleeding in critically ill patients and the treatment of gastric ulcers, or GU, and includes data from our pivotal Phase III clinical trial with 359 critically ill patients at approximately 50 sites evaluating Rapinex powder-for-suspension in a 40mg dose and a comparator product for the prevention of upper GI bleeding. No PPI is currently approved for the prevention of upper GI bleeding in critically ill patients.
Our other two product candidates, Rapinex capsule and Rapinex chewable tablet, are alternative formulations of immediate-release omeprazole. We believe these product candidates will provide many of the same clinical advantages as Rapinex powder-for-suspension with the convenience of a capsule or chewable tablet. We are currently developing formulations of these candidates for use in pivotal pharmacokinetic/pharmacodynamic, or PK/PD, clinical trials that we plan to initiate in 2004. We intend to pursue initial indications for the treatment of heartburn and symptoms associated with GERD, treatment and maintenance of healing of EE, and treatment of DU and GU. If the pivotal PK/PD clinical trials are successful, we believe that we can submit new drug applications seeking approval for our product candidates for these indications without the need to conduct additional clinical trials.
The following table summarizes certain information regarding our current product candidates:
Product
Candidate Dose Potential Indications Status
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Rapinex powder-for- suspension 20mg Heartburn/ GERD, EE, DU NDA submitted in August 2003
40mg Prevention of Upper GI Bleeding in Critically Ill Patients, GU NDA submitted in February 2004
Rapinex capsule 20mg/40mg Heartburn/ GERD, EE, DU, GU Pivotal PK/PD clinical trials planned to start in 2004
Rapinex chewable tablet 20mg/40mg Heartburn/ GERD, EE, DU, GU Pivotal PK/PD clinical trials planned to start in 2004
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We have licensed from the University of Missouri exclusive, worldwide rights to patents and patent applications covering specific formulations of immediate-release PPIs and antacids for treating upper GI diseases and disorders. The initial issued U.S. patents on which our Rapinex product candidates are based expire in July 2016.
Our management team has substantial experience in product development, manufacturing, clinical development, regulatory affairs and sales and marketing through their participation at other companies in the successful development and commercialization of GI products such as Prilosec., Tagamet., Remicade., Carafate. and Pentasa.. We believe this experience will allow us to successfully build our business, including our commercial organization.
TAP Pharmaceutical Products Agreement
In June 2002, we entered into a strategic sublicense agreement with TAP Pharmaceutical Products Inc., or TAP, in which we granted TAP the North American rights to develop, manufacture and sell products resulting from the use of our immediate-release PPI technology with lansoprazole, TAPs patented PPI sold under the brand name Prevacid., and derivatives of lansoprazole. We received an upfront fee of $8.0 million and are entitled to milestone payments which may exceed $100 million and to royalties on any future sales, subject to our obligations to the University of Missouri. In addition, TAP is responsible for all of its product development and commercialization expenses.
In 2003, sales of Prevacid in North America were approximately $4.0 billion, according to IMS Health. We believe that if TAP successfully develops and commercializes one or more new products based on our licensed patent rights, TAPs commercialization efforts will, in addition to providing revenue to us, help drive market acceptance of immediate-release PPI products.
Strategy
Our business strategy is to develop and market proprietary pharmaceutical products for the prevention and treatment of GI diseases and disorders with new formulations, enhanced drug delivery systems or expanded indications that are based on currently marketed products or compounds that have clinically demonstrated safety and efficacy. We believe this business strategy will potentially reduce development and
regulatory risks and enhance market acceptance of our products. In order to continue to execute our business strategy, we plan to:
expand our commercial organization to include a sales force that promotes our products in the U.S. to the highest-prescribing specialists and primary care physicians treating GI diseases and disorders;
partner with companies to further develop and promote our products in the U.S. and internationally; and
enhance our product portfolio through internal development, product and patent licensing and strategic acquisitions. |
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