Fellow Inflazyme Investors and Others,
This last Tuesday I finally spoke with Ian McBeath over the phone. It was a 30-40 minute conversation, and I can tell you that I was very impressed. I believe that he is an highly intelligent, exceptionally well-spoken individual.
I think there's a decent chance that a significant turnaround is in progress and that there's potential for a lot of good news in a stepwise fashion over the next 1-1 1/2 years.
The problem that's been the bane of this company was the complicated synthesis of IPL 576, previously called Apanol (that name has been dropped). It was an analogue of contignasterol, a natural compound derived from a marine sponge that required 31 synthetic steps. Even though the synthesis of this analogue ("Apanol") was down to 12 steps, it was still quite difficult to produce. It has a sterol nucleus, which is hard to manufacture, and a unique, novel side chain. To speed things up they surveyed other analogues and found one with an equivalent therapeutic profile but which only required 8 synthetic steps. It's still difficult to produce, as it's completely novel, but much progress has been made. There is one difference, the analogue is at least fivefold more potent. Acute dosing studies have been conducted, and with completion of timely delivery of a large amount of product the the rest of the acute tox and the chronic dosing studies may be completed within 3 or so months from this point in time. It takes some time to compile and organize the data in a presentable form, and Phase 1 studies may start around midyear '99. They will also be testing this analogue on other models of inflammation.
There are no joint venture deals yet for two primary reasons: 1) They hope to take development to Phase 2A, at least, in order to get a better deal, and 2) Since the analogue appears to have a novel mechanism of action they want to study it in more detail hopefully to be able to develop a whole slew of new compounds based on the drug's target. Don't expect Inflazyme to take it through Phase 3, however, as that requires at least 2 separate very large-scale studies.
As far as Cortecs and the tb antigen test kits, the ELISA (hospital lab-based) and point-of-care (general clinic/office), IZP had received the ELISA kits and determined that it met their requirements. Cortecs is striving to conduct a clinical trial sufficient for marketing approval, and expects marketing to begin in 2000, although IZP doesn't expect to see any revenue from it until 2001. The point-of-care kit is about one year behind that.
I had previously thought that the license to Supergen was for 2 chemotherapeutic compounds. It's actually for a "process," really for the right to use some microbes to produce these substances. There may be a progress report from Supergen in the not-too-distant future.
In late Oct.-early Nov. Mr. McBeath is going to travel to various major cities in North America to update institutions and analysts on the company's status and goals.
In summation, I think Mr. McBeath represents the company quite well and shows highly capable, analytic leadership. The company again seems, to me, to hold a lot of promise.
I hope this information is useful to at least some of you out there.
Sincerely,
Harold
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