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Growing from a broader base

John Fraher

Created in 2011, through the merger of Axcan Pharma Holding B.V., a private speciality pharmaceutical company, and Eurand, N.V., a publicly traded European drug delivery and speciality harmaceutical business, Aptalis Pharma is looking to grow its activities in gastrointestinal and cystic fibrosis treatments while leveraging and expanding its substantial pharmaceutical technology assets.

"Through the combination of the two businesses we have created a company that has a robust portfolio and growing pipeline of products to treat gastrointestinal disorders and cystic fibrosis, a set of innovative development platform technologies and established manufacturing expertise and capabilities," noted John Fraher, President, Aptalis Pharma. The company currently generates approximate revenues of $540 million a year.

Both companies had a strong presence in the GI field and this alone provided a compelling commercial rationale for Axcan’s acquisition of Eurand. However, Eurand’s suite of platform technologies, which was the foundation of its business and mainly focused on oral drug delivery, gives the company the ability to create additional new products, more quickly, for both internal and external customers.

With backing from its majority shareholder the private equity group Texas Pacific Group (TPG), Aptalis is now looking to build its business both organically and externally through acquisitions and partnering. Aptalis is keen to out-license current products to partners in markets where it is not present, while in-licensing potentially exciting new compounds to treat GI and cystic fibrosis disease states. For Aptalis, the sweet spot is clearly speciality pharmaceutical companies.

Mr Fraher is convinced that having such a specific focus on a limited number of therapeutic areas enhances his company’s attractiveness as a potential partner for companies with compounds in the space. "It is clear to potential partners that such assets are core to our business and consequently will pay more attention to them than others with broader portfolios might," he added.

Moreover, having in-house expertise in the area and a capability of enhancing the offering through its own proprietary drug delivery platforms, positions Aptalis more than many other potential licensors to assess the risk : benefit ratio associated with an asset. And having a broader based organisation, with the financial wherewithal to fund further development as provided by an investor, enables Aptalis to take on more risk in such programmes than in the past.

With the company’s business still heavily skewed to serving the US and, to a lesser extent, the West European markets, Aptalis is looking for opportunities to expand its footprint in the emerging markets, particularly for its technology platforms.

"While we want to continue developing our speciality and mid-size pharma partnerships in the US, which has been the bedrock of our development programmes in recent years, we want to increase the number of partnerships in emerging markets, especially in South East Asia and Latin America. While we have been growing there in the past few years, I think 2012 is set for an excellent year," he noted. Central and Eastern Europe, Russia and other Commonwealth of Independent States (CIS) countries have historically been attractive markets for out-licensing activtity.

Aptalis currently markets several products including Zenpep® (pancrelipase) Delayed-Release Capsules to treat exocrine pancreatic insufficiency (EPI) due to cystic fibrosis (CF) and other conditions, which is already on sale in the US and currently being prepared for registration in the European markets. The porcinederived pancrelipase, which was developed using the legacy Eurand drug delivery capabilities, captured 22% share of the US market within the first year of its launch.

In January 2011, Nycomed, which is now owned by Takeda, acquired exclusive commercialisation rights to Zenpep in Russia, the CIS, Georgia and Mongolia. As part of the deal, the partner agreed to take responsibility for obtaining regulatory approval in the territories.

In addition to considering outlicensing other products in the Aptalis pipeline, such as Pylera®, a treatment for Helicobacter pylori infections which is approved in five EU markets and is poised for launch into the German market, Canasa®, to treat active ulcerative proctitis, Carafate®, for short-term treatment of active duodenal ulcers, the company is also looking to acquire additional assets.

In April 2011, Aptalis acquired the San Diego-based infectious disease-focused company Mpex Pharmaceuticals Inc. to essentially get access to Aeroquin®, which is in Phase III testing to treat pulmonary infections in CF patients. Aeroquin is a proprietary inhaled formulation of levofloxacin, a fluoroquinone antibiotic that targets bacterial DNA gyrase and topoisomerase, to treat bacterial infections.

Aptalis also intends to leverage and bolster the opportunities provided by the delivery platforms it secured through the Eurand acquisition. "Through our collaboration agreements, we have successfully applied our technologies to drug products in a diverse range of therapeutic areas, including cardiovascular, pain, gastrointestinal and respiratory, resulting in a broad portfolio of products for out-licensing," he noted.

This is not a new direction for the company; in 2008, the legacy Eurand business granted Daewoong Pharmaceutical exclusive rights to commercialise Cyclobenzaprine Hydrochloride ER in South Korea to treat muscle spasms associated with acute painful musculoskeletal conditions. The challenge was to develop a more convenient – once-daily administration – dosage form of the muscle relaxant drug. It is marketed as Amrix® in the US by Cephalon, Inc, now a Teva Pharmaceutical Industries company, and Bonelax ER by Daewoong in South Korea.

Similarly, the Eurand business signed a development deal with GlaxoSmithKline in 2006 to develop a formulation of Lamictal® ODT™ (lamotrigine) using the Aptalis proprietary AdvaTab® orally disintegrating tablet and Microcaps® taste-masking technologies. The reformulated sodium channel inhibitor was approved by the FDA in 2009 for the long-term treatment of bipolar I disorder to lengthen the time between mood episodes in adults who have been treated for mood episodes with other medications.

While the company already has a number of "off-the-peg" products that use its technologies available for licensing, Aptalis is also looking for partners that would like to establish co-development deals. "We are looking for co-development opportunities with our technologies to develop new value-added products for partner companies. In particular, partners who have identified a specific need for access to oral delivery technologies," added Mr Fraher.

Indeed, Aptalis provides partners with access to its experienced product development management teams as well as international R&D and manufacturing capabilities. By moving away from a fee for service business, Aptalis has proceeded up the value chain to become a co-developer of new products, partially funding some of the costs, and so sharing in the risks and rewards of programmes. Although growing speciality pharmaceutical companies are in the sweet spot for such deals, the company expects to sign up companies in emerging markets that are looking to develop proprietary portfolios.

"We have a team, based in Europe, that is targeting companies in the emerging markets for both out-licensing our products and our technologies for co-development opportunities," he added. Aptalis has plans to continue to invest in additional technologies to complement the drug delivery platforms it acquired through Eurand to both enhance its own internal development pipeline and anchor deals with partners. As an established pharmaceutical technology company, Aptalis is interested in technologies that can provide effective solutions for the still many unmet needs in optimised delivery of drugs in disease treatment.