September 13, 2010Santarus Adds Two Novel Biologic Drug Candidates to Pipeline
Signs Agreements with Pharming for Exclusive North American Rights to Late-Stage Biologic Drug RHUCIN
Acquires Worldwide Rights for Anti-VLA-1 Antibody Through Acquisition of Covella Pharmaceuticals
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SAN DIEGO, Sep 13, 2010 (BUSINESS WIRE) -- Santarus, Inc. (NASDAQ: SNTS), a specialty biopharmaceutical company, has expanded its development pipeline with the addition of two novel biologic drug candidates focused on specialty markets. Santarus has signed exclusive license and supply agreements with Pharming Group NV (NYSE Euronext: PHARM) granting Santarus the right to commercialize RHUCIN(R) (recombinant human C1 inhibitor) in North America for the treatment of acute attacks of hereditary angioedema (HAE) and other future indications. Santarus also has acquired the worldwide rights to a novel biologic drug candidate, an anti-VLA-1 antibody that has shown activity in multiple preclinical models of inflammatory and autoimmune diseases, through the acquisition of Covella Pharmaceuticals, Inc., and by amending a related license agreement with Biogen Idec MA Inc.
"The addition of these two promising product candidates to our development pipeline reflects an important step toward transforming Santarus into a premier biopharmaceutical company focused on specialty markets," said Gerald T. Proehl, president and chief executive officer of Santarus. "We believe that these biologic products offer significant future revenue potential with attractive proprietary positions, including 12 years of data exclusivity if approved by the FDA, strong intellectual property and significant manufacturing barriers to competition. With successful clinical development and commercialization, these product candidates have the potential to address substantial unmet medical needs and dramatically enhance shareholder value."
He added, "In the past week we have completed three business development transactions under financial terms that are primarily success-based that add an attractive commercial product and two development products to our portfolio. We now have a diverse development pipeline with three late-stage product candidates - RHUCIN, budesonide MMX(R) and rifamycin SV MMX(R) - in Phase III clinical programs and a promising earlier stage anti-VLA-1 antibody, all of which offer significant commercial potential. Last week we announced the expansion of our commercial portfolio with the addition of CYCLOSET(R), an FDA-approved, novel product to treat type 2 diabetes. CYCLOSET is an excellent strategic fit with GLUMETZA(R) that allows us to leverage our sales organization. We believe that our cash, cash equivalents and short-term investments and borrowings available under our line of credit with Comerica Bank will be sufficient to fund our operations at least through the end of 2011."
RHUCIN Agreements and Background
Santarus has entered into exclusive license and supply agreements with Pharming granting Santarus the right to commercialize RHUCIN in North America for the treatment of acute attacks of HAE and other future indications. Under terms of the license agreement, Santarus will pay Pharming a $15 million upfront fee and an additional $5 million milestone upon U.S. Food and Drug Administration (FDA) acceptance of Pharming's Biologic License Application (BLA) for RHUCIN. Santarus may also pay Pharming additional success-based clinical and commercial milestones, including upon achievement of certain aggregate net sales levels of RHUCIN. Santarus will purchase its commercial supply of RHUCIN from Pharming at a tiered supply price, based on a percentage of net sales of RHUCIN. For additional terms of the license and supply agreements with Pharming, please refer to Santarus' Form 8-K to be filed today summarizing certain provisions of the agreements.
The FDA has granted Orphan Drug and Fast Track Status to RHUCIN for the treatment of acute attacks of HAE, a genetic disorder in which the patient is deficient in or lacks a functional plasma protein C1 inhibitor, resulting in unpredictable and debilitating episodes of intense swelling of the extremities, face, trunk, genitals, abdomen and upper airway. The frequency and severity of HAE attacks vary and are most serious when they involve laryngeal edema, which can close the upper airway and cause death by asphyxiation. According to the U.S. Hereditary Angioedema Association, epidemiological estimates for HAE range from one in 10,000 to one in 50,000 individuals.
Pharming has conducted two randomized, placebo-controlled, double-blind studies and four open-label studies with RHUCIN for the treatment of acute HAE attacks. Both placebo-controlled clinical studies showed highly statistically significant and clinically relevant improvement in time to beginning of relief of symptoms and time to minimal symptoms at RHUCIN dosage strengths of 50 U/kg and 100 U/kg compared to placebo.
Pharming plans to submit the BLA for RHUCIN to the FDA in late 2010 or in January 2011 and believes that it has sufficient data to commence the FDA review process. At the same time, based on prior discussions with the FDA, Pharming is planning to initiate an additional placebo-controlled, double-blind clinical study with approximately 50 patients to provide additional data in support of the 50 U/kg dose. Data from the placebo-controlled study will also be used to provide additional validation of the visual analog scale used in measuring the clinical effects of RHUCIN. An open-label extension of the clinical study will be conducted to confirm the efficacy, safety and lack of immunogenicity of RHUCIN at 50 U/kg for the repeated treatment of acute HAE attacks.
Regarding this transaction, Mr. Proehl said, "RHUCIN is designed to provide an attractive alternative to currently marketed plasma-derived C1 inhibitors, bypassing potential constraints of human blood supply limitations such as plasma donor restrictions and possible viral and other disease transmission risks. Assuming successful clinical development and regulatory approval, we expect to promote RHUCIN through a small specialty sales force to the approximately 1,000 immunologists and allergy specialists in the U.S. who treat HAE."
Anti-VLA-1 Antibody Agreement and Background
Santarus has acquired the exclusive worldwide rights to a humanized anti-VLA-1 antibody, through the acquisition of closely held Covella Pharmaceuticals, Inc., and a related amended license agreement with Biogen Idec. The anti-VLA-1 antibody was initially developed by Biogen Idec and licensed to Covella in January 2009.
Under the terms of the acquisition, Santarus is paying a total in cash and stock of approximately $1.8 million in a combination of upfront consideration, assumption of Covella liabilities, and transaction expenses. Santarus will also make clinical and regulatory milestone payments based on success in developing product candidates, and will pay a royalty on net sales of any commercial products resulting from the anti-VLA antibody technology.
Under the amended license agreement, Santarus will make additional clinical, regulatory and sales milestone payments to Biogen Idec based on success in developing and commercializing product candidates and will pay a royalty on net sales of products developed under the l