Protalix BioTherapeutics’ (NYSEMKT:PLX) downward share price trend in recent months continued today with news that the FDA has requested additional data to validate the manufacturing process for Gaucher's disease drug Uplyso (taliglucerase alfa), causing shares in the Israeli biotech to slip 7% to $6.55 in early trade.
In some respects the FDA’s scrutiny of the manufacturing process is hardly surprising, given the product’s novel origin from plant cells and the recent contamination issues at Genzyme’s (GENZ) factories producing Cerezyme in Chinese hamster ovary cells. Protalix hopes to submit the required data in the second quarter, potentially delaying approval by six months to the end of 2010. As to what this means for Shire’s velaglucerase, also awaiting an FDA decision by February 28, is hard to say but its manufacturing process will need to be incredibly robust to clear the high regulatory hurdle.
Seeking to take advantage
Genzyme’s issues with Cerezyme last year were well documented and seen as presenting an opportunity for new enzyme replacement therapies (ERT) to reach the market and capitalise (Therapeutic focus - Spotlight falls on new Gaucher treatments amid Genzyme's woes, August 6, 2009).
As highlighted by EP Vantage, Protalix’s novel production technology was always likely to face huge scrutiny by the FDA, perhaps more so than Shire’s velaglucerase, which is produced in human cells.
While both products have been made available to Gaucher’s disease patients under an FDA-approved treatment protocol to try and plug the hole left by the halt on manufacturing of Cerezyme, formal FDA approval remains massively important to both drugs' chances of realising their commercial potential of a few hundred million dollars in annual sales.
As for Protalix, whose shares hit an 18-month high in November of $12.14, the setback adds further disappointment for investors who somewhat harshly were unimpressed by its licensing deal with Pfizer (NYSE:PFE) in December, having hoped for a full takeover (Protalix brings on Pfizer as fight for Gaucher patients looms, December 2, 2009).
Pfizer’s decision to share the risk through a licensing deal is looking like a smart one.