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Sunday January 6, 11:58 am Eastern Time
Little Scios targets drug giants in arthritis war
By Toni Clarke
NEW YORK, Jan 6 (Reuters) - Scios Inc. (NasdaqNM:SCIO - news), a small California biotechnology company, is racing giant rivals to bring a pill to market that would displace injectable anti-inflammatory drugs and set a new standard in arthritis treatment.
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Scios' ambitions are much larger than its market capitalization of a little more than $1 billion. That's because the first company to commercialize an oral version of today's dominant injectable drugs could gain the lion's share of a market that analysts expect to reach $6 billion by 2009.
Scios' drug has shown promise in early trials. But the size of the potential market makes it a prize that many big pharmaceuticals companies also covet.
``This is a very tight race,'' said David Gryska, Scios' chief financial officer. ``We don't intend to be second.''
So far, Scios' prospects look good. The company's compound appears to inhibit an enzyme, known as the p38 kinase, that scientists believe provokes inflammation.
The company has completed trials in healthy humans and is now planning to test the drug in patients with rheumatoid arthritis. Most rivals have yet to reach this stage.
``Scios is in the lead right now,'' said Eric Schmidt, an analyst at S.G. Cowen. ``They've come from behind to take that inside track position. But it's clear that it's still very early in the race.''
Scios' lead comes in part because an earlier trailblazer, Vertex Pharmaceuticals Inc. (NasdaqNM:VRTX - news), was forced to drop back after its lead p38 kinase inhibitor showed toxicity in high doses in some animals. The company is now developing other molecules directed at the same target.
BETTING THE RANCH
Unlike Vertex, Scios has no other p38 kinase inhibitors to fall back on. If Scios' compound fails, it will be a substantial blow since it has only one drug on the market: recently launched congestive heart failure drug Natrecor.
``We're betting the ranch on it,'' Gryska told Reuters.
For that reason, the company aims to team up with a big partner as the drug moves through the approval process.
``Prudence dictates that we ally ourselves with a large pharma company,'' Gryska said. ``There's a lot of interest in us in the pharmaceuticals industry.''
There are also many competitors. They include drug giant GlaxoSmithKline Plc (quote from Yahoo! UK & Ireland: GSK.L), which first isolated the p38 kinase in the early 1990s. Glaxo's drug is in early stage clinical trials for rheumatoid arthritis, asthma and irritable bowel syndrome, said Rick Koenig, a company spokesman.
Other rivals include Merck and Co. Inc. (NYSE:MRK - news), Roche Holding Ltd. , Johnson and Johnson (NYSE:JNJ - news), the maker of injectable arthritis treatment Remicade, and Amgen (NasdaqNM:AMGN - news), which recently acquired Enbrel, another leading injectable arthritis treatment.
Even if Scios keeps its competitive edge, there are plenty of hurdles ahead. As Vertex can testify, just because a drug shows promise in animal trials, that does not mean it will work in humans.
``They still have significant challenges ahead of them, and until those are sorted out, they won't truly know where they stand,'' said John Alam, senior vice president for drug evaluation and approval at Vertex.
HIGH EXPECTATIONS
What keeps scientists working on p38 kinase inhibitors is their potential to be effective in a wide number of diseases.
Over the past decade, inflammation has been shown to play a part in such major diseases as congestive heart failure, coronary artery disease and Alzheimer's, as well as arthritis.
``I firmly believe that oral anti-inflammatory drugs will come to be a class of drugs that's as important over the next 20 years as anti-depressants and cholesterol-lowering drugs were in the 1990s,'' said Alam.
If Scios' drug could displace Enbrel and Remicade, it would reach sales of more than a billion dollars. But Scios believes it could more than double those sales by taking market share from two other leading arthritis drugs: Merck's Vioxx, and Celebrex, made by Pharmacia (NYSE:PHA - news).
These so-called Cox-2 inhibitors are painkillers that relieve the symptoms of inflammatory disease but do not alter the progression of the disease. Sales of Cox-2 inhibitors in 2000 were about $4.8 billion.
``Our drug should give symptom relief and at the same time arrest the progression of the disease,'' Gryska said. |
