I posted the article on the Yahoo:CYPB board.
Here is Part I:
CYPRESS BIOSCIENCE, INC. | Jay Kranzler
By the time Jay Kranzler took the helm of Cypress Bioscience and moved it
to San Diego two years ago, people had long since dismissed the biotech as
a shady company with a product that was basically junk.
Cypress, then known as Imre Corp., had gone through bruising patent
disputes and an unhappy distribution relationship with Baxter
International. Cypress had also attracted the attention of securities
regulators.
Its Prosorba column, a sort of blood filter, had been in use for more than
a decade to treat an extremely unusual bleeding disorder -- a condition so
rare that Cypress made barely any money from the device.
Some doctors were skeptical that it worked at all.
"Before January nobody wanted to talk about the Prosorba column," Kranzler
said. "They all said it's black magic, a black box."
But Kranzler, who previously headed San Diego's Cytel Corp., has
resurrected Prosorba and turned the 39-employee company into one of the big
biotech surprises of the first half of the year.
In January, the company announced new data that suggest Prosorba is
effective against rheumatoid arthritis -- the inflammation of the joints
that afflicts millions. Though the device would probably be used only in
severe cases, that could be many thousands of patients.
The stock doubled, and Cypress started submitting materials to the Food and
Drug Administration toward approval of Prosorba for rheumatoid arthritis.
The company hopes to receive a decision from the FDA next year.
Even sales of Prosorba for the bleeding disorder, known as idiopathic
thrombocytopenic purpura, or ITP, have increased. Prosorba revenue reached
$3.0 million last year after sinking to $1.1 million two years earlier,
though the company remains unprofitable.
"We still have a long, long way to go," Kranzler said. "But the momentum
has started."
The story of Prosorba goes back to the mid-'80s, when a graduate student at
the University of Washington developed the column as part of his work
toward a Ph.D. thesis.
The device is a 3 1/2 -inch tall cylinder that contains 200 milligrams of
Protein A, a substance that is thought to act like a sponge to absorb
harmful protein complexes that contribute to disease. A patient's blood is
drawn from one arm, fed through the column, and then returned to the
patient's other arm.
The procedure takes about two hours, with ITP patients receiving six
treatments and rheumatoid arthritis patients expected to receive 12.
At first the graduate student experimented with the column on a cat with
leukemia, and the work was successful enough to attract investors to
support further development of the device. The new company, Imre, used the
investors' funds to begin testing the column on AIDS patients, since some
thought cat leukemia might in some ways parallel AIDS.
No breakthrough in AIDS emerged, but the column proved effective in
boosting patients' platelet counts, thus aiding in blood clotting and
coagulation. That led to the 1987 FDA approval for the column's use in
treating ITP, a condition that leads to serious bleeding after the body
produces antibodies to destroy its own platelets.
Over the next decade, however, the company failed to capitalize
significantly on its discovery. In Prosorba's first five years on the
market, Imre recorded just $7.8 million in revenue. And though sales
increased somewhat in the mid-'90s, any gain was wiped out in a dismal
1996, when escalating costs and restructuring charges yielded a $15.5
million loss.
** sorry it didn't paste well. |
