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Modern medicine has undergone a revolution in the past three decades with the advents of genomics and more recently with the field of proteomics. Lipidomics, the study of pathways and networks of cellular lipids in biological systems, could likely start dominating biotech headlines as pharmaceuticals and the medical community start focusing on lipid signaling and how its control could be used to fight disease. The modern biotech and Big Pharma experience with lipids had been focused on what was thought to be the only important functions of lipids in the biological system, energy storage and structural component of cell membranes. However, the newly discovered third function of lipids, lipid signaling, could be leading a revolution in how many diseases and their treatments are approached.

Lipid signaling refers to any physiological signaling event involving a lipid messenger that binds a protein target, such as a receptor, kinase or phosphatase, which in turn mediate the effects of these lipids on specific cellular responses. These cellular responses include the ability of cells to perceive and correctly respond to their biological environment and are the basis of development, tissue repair, and immunity as well as normal cell (and thus tissue) homeostasis. Any disruption of these processes can lead to a host of cancers, autoimmune diseases, inflammations and other ailments. Current regulation of these signaling pathways involve two predominate approaches, elimination of these bioactive lipids or tying up their receptor sites which effectively neutralizes the signaling function.

Novartis (NYSE:NVS), in terms of regulatory approval, led the way with its September 2010 approval of Gilenya, a first-line treatment for relapsing forms of multiple sclerosis. This approval made Gilenya the first oral treatment indicated for relapsing forms of MS available in the US and underscores the importance of where this fledgling field is headed. Gilenya is the first in a new class of drugs called sphingosine1-phosphate receptor (S1PR) modulators. Although the exact mechanism by which the drug itself works is still unclear, it is thought to work by reducing the immune system's attack on the central nervous system by retaining certain white blood cells in the lymph nodes. This prevents them from reaching the CNS, where they could attack the protective covering around the nerve fibers, resulting in less inflammatory damage to the nerve cells seen in multiple sclerosis patients. Gilenya’s efficacy data speaks for itself with Phase III data showing a reduction in MS relapses by over 52% relative to Biogen Idec’s (NASDAQ:BIIB) Avonex. Additional data from a two-year placebo-controlled study showed a reduction in relapse rate (54% reduction P<0.001, relative to placebo) and risk of disability progression among Gilenya patients (30% reduction confirmed at three-month follow-up visit P=0.02, relative to placebo).

Peregrine Pharmaceuticals’ (NASDAQ:PPHM) pipeline includes a monoclonal antibody that targets a conjugated protein-lipid. Its lead candidate, Bavituximab, is a first-in-class phosphatidylserine (PS)-targeting monoclonal antibody, a new approach to treating cancer. PS is a highly immunosuppressive molecule usually located inside the cell membrane of healthy cells. However it inverts and becomes exposed on the outside of cells that line cancer tumor blood vessels. For cancer researchers, this becomes a key target by which to attack the cancer. PS-targeting antibodies target and bind to PS and block the immunosuppressive signal, enabling the immunity system to recognize and fight the tumor.

Bavituximab has shown promise in several oncology indications but is currently in Phase II studies for Peregrine in front-line and second line non-small cell lung cancers (NSCLC), breast cancer and pancreatic cancer. The front-line NSCLC Phase II trial is evaluating Bavituximab with Paclitaxel and Carboplatin versus Paclitaxel and Carboplatin in 86 patients. Enrollment in this trial has completed with interim data from the study likely released in Q4 2011. In June 2011 Peregrine released interim data indicating a Median Overall Survival (MOS) of 12.4 months using Bavituximab in combination with Carboplatin and Paclitaxel compared to 10.3 months MOS from a separate historical control trial using Carboplatin and Paclitaxel. Phase II data for patients with locally advanced or metastatic breast cancer were released in August 2011 with promising results. A 20.7 month MOS from a prior single-arm Phase II trial evaluating Bavituximab in combination with Docetaxel compared very favorably relative to Docetaxel alone with a historical MOS of 11.7 months, a 77% improvement. Key here is the lipid-signaling approach they’re taking by focusing on the phosphatidylserine bioactive lipid appears to be working and has demonstrated efficacy across a broad range of cancers thus far.

Lpath, Inc. (NASDAQ:LPTN) has taken the approach of targeting bioactive lipids and the science of lipidomics to a different level with its proprietary platform, Immune Y2 technology. Instead of attacking or neutralizing the receptor sites involved with the pathways, Lpath has created monoclonal antibodies against the lipids themselves. These antibodies are the foundation behind the company’s lead product candidates iSONEP, ASONEP, and Lpathomab. Essentially, these antibodies “sponge up” the targeted lipids and fully bind all receptor sites, stopping the pathway signaling cold.

iSONEP is a monoclonal antibody against SP1 with indication of treating retinal diseases. Lpath initiated the first of two proof-of-concept trials in September of 2011, the first of which is termed the PEDigree trial in which iSONEP is being studied as a treatment for retinal pigment epithelium detachment. Lpath plans to dose 32 subjects that have PED secondary to wet age-related macular degeneration (wet AMD) or polypoidal choroidal vasculopathy (PCV). In October 2011, Lpath initiated its Nexus Phase II trial on iSONEP as a treatment for wet AMD. In the earlier Phase I trial, iSONEP met its primary endpoint of being well tolerated and also succeeded in meeting a key secondary endpoint in that a positive biological effect was observed in most patients in a single dose, many who had failed to respond positively to Lucentis and/or Avastin (off-label indication for the latter) treatments. In order to succeed for this indication, iSONEP needs to have non-overlapping success relative to current treatments. Lpath thinks iSONEP will meet these non-overlapping efficacy requirements based on Phase I data. In that trial an occult sub-group indicated regression of the CNV lesions with 2 of 2 patients showed good resolution of RPE detachment, both key endpoints in which could allow a path to regulatory acceptance if the results carry over to final trials with at least similar efficacy on the other symptoms Lucentis regulates.

Although still early in the regulatory path, Pfizer (NYSE:PFE) is apparently convinced enough with the Immune Y2 technology that is has already inked a contract with Lpath for iSONEP, one that netted Lpath $14 million on January 2011. Additional clauses in the deal could net Lpath regulatory and commercial milestone payments that could total up to $497.5 million plus double-digit royalties to iSONEP pending approval. The agreement also gives Pfizer a time-limited right of refusal on ASONEP (another formulation of the same SP1 antibody as iSONEP) for the treatment of cancer. A Phase II trial on ASONEP will initiate in 2012 for the treatment of renal cell carcinoma and will be a huge catalyst for the company’s common stock and will add to the excitement that the PEDigree trial results should give investors in Q2 2012 as well.

Lpath has huge plans for 2012 with its growing pipeline and possible uplisting to the NASDAQ or AMEX stock exchanges. As icing on the cake, the agreement with Pfizer and other funding obtained has shored up Lpath’s balance sheet giving it sufficient cash to likely operate into June 2013 per current plans. Stock offering (dilution) concerns present in so many development Phase biotechs should be minimal to 1Q 2013 at least. Not thinking short-term, Lpath has been securing its intellectual properties with patents it hopes to protect its technology and applications. These patents add value to the company and its pipeline by protecting against competition and giving it a stronghold by which to license out its technology in the future as trial successes build its pipeline.

This is the biotech arena, and it not forgiving to investors who choose poorly but can be profitable to those lucky enough or wise enough to make the correct decisions. Although late-entry positions in Lpath, Inc. or Peregrine Pharmaceuticals will likely still afford investors moderate gains after trial results are reported and milestone payments are announced, entry well before those huge catalysts will likely afford investors substantial gains many multiples over the later entry ones. Entry into NVS common stock at this time with its $131 billion market cap, although a much safer investment, does not have nearly the potential gains with its successes as positive trials in $72.5 million market cap PPHM or $55 million LPTN. Investors, Big Pharma and the medical community will be watching as the lipidomics medical revolution comes with Novartis, Peregrine Pharmaceuticals and Lpath, Incorporated leading the way.

Disclosure: Long position in PPHM.

Source: Lipid Signaling Could Shake Up Biotech In 2012 With Pending Lpath And Peregrine Trial Data