As discussed in earlier parts of this series (starting with part one), risk mitigation is crucial in successful small biotech investing and key to this strategy is finding companies with big, robust pipelines.
Ligand Pharmaceuticals (LGND) and Isis Pharmaceuticals (ISIS) with market capitalizations of $315 million and $820 million are companies that have large, promising pipelines.
Ligand Pharmaceuticals
Ligand Pharmaceuticals, based out of La Jolla, California, has a large and diverse developmental pipeline addressing multiple disease areas. With 8 marketed products and over 60 programs in development-many of which are partnered with big pharma/biotech companies-the company has developed a portfolio that is one of the largest when compared to its competition.
Already approved for use in chronic immune idiopathic thrombocytopenic purpura, Eltrombopag or Promacta-a compound partnered with GlaxoSmithKline (GSK)-is currently in phase III trials for treating thrombocytopenia from chronic hepatitis C infection. Thrombocytopenia, or deficiency of platelets in the blood causes bleeding, slow clot formation, and bruising and is often a limiting step in treating patients with interferon and ribavirin in advanced hepatitis C infections. Promacta is able to increase platelet count, permit initiation of antiviral treatment, prolong antiviral therapy, and in studies, demonstrate a greater sustained virologic response when compared to placebo. If approved, as estimated by UBS AG, sales of Promacta for GlaxoSmithKline and Ligand can reach $2 billion dollars and achieve blockbuster status.
Furthermore, in the pipeline, a NDA is expected to be filed in 2012 for Aprela, a partnered compound with Pfizer (PFE). Aprela is a once daily, orally administered medication used to reduce menopausal symptoms such as hot flashes and osteoporosis. In studies, Aprela has demonstrated a better side effect and safety profile relative to older hormonal replacement therapies
Aside from drug partnerships, Ligand is receiving milestone and low single to double-digit royalty payments for Captisol, a technology that improves the pharmacokinetics, stability, and solubility of drugs. This technology is used in 5 of their 8 FDA approved and partnered products and is showing promise in the Captisol-enabled melphalan program.
Listed below are compounds that are currently in clinical/preclinical trials, many of which are partnered with big pharma/biotech companies:
Program | Partner | Indication | Clinical Trial Status |
Fablyn | Chiva | Osteoporosis | NDA |
Carfilzomib | Onyx (ONXX) | Oncology | Phase III |
Carbamazepine-IV | Lundbeck | Central Nervous System | Phase III |
Undisclosed Captisol Program | Merck (MRK) | Undisclosed | Phase III |
Promacta | GlaxoSmithKline | Hepatitis C | Phase III |
Aprela | Pfizer | Menopause | Phase III |
Clopidogrel-IV | The Medicines Company (MDCO) | Anti-arrhythmia | Phase II |
Promacta | GlaxoSmithKline | Oncology | Phase II |
Dinaciclib | Merck | Oncology | Phase II |
Tanzisertib | Celgene (CELG) | Pulmonary Fibrosis | Phase II |
Tanaproget | Undisclosed | Contraceptive | Phase II |
GSK2285921 | GlaxoSmithKline | Idiopathic thrombocytopenic purpura | Phase II |
Delafloxacin | Rib-X | Infection | Phase II |
Pradefovir | Chiva | Hepatitis B | Phase I |
MB01733 | Chiva | Hepatocellular carcinoma | Phase I |
XL652 | Exelixis (EXEL) | Atherosclerosis | Phase I |
XL550 | Exelixis | Metabolic disorders | Phase I |
CXCR4 | Proximagen | Inflammation | Preclinical |
Undisclosed | SAGE | Central Nervous System | Preclinical |
Additionally, Ligand has more than 25 undisclosed partnered Captisol-enabled programs and 5 unpartnered programs.
Ligand has a market capitalization of $315 million and currently trading at $15.96 with a 52-week range of $9.16 - $16.24. The company has approximately $17 million in cash and equivalents, $10 million in short-term debt, and $29 million in long-term debt.
Isis Pharmaceuticals
An innovator and leader in antisense-drug development, Isis Pharmaceuticals has a large and broad pipeline that targets a number of disease areas. With over 1,500 issued patents and 27 drug programs addressing areas such as cancer, metabolic, inflammation, and cardiovascular, Isis is well diversified in disease targets.
Mipomersen or Kynamro, a partnered compound with Genzyme/Sanofi (SNY), met all primary, secondary, and tertiary endpoints in four Phase III trials. Kynamro is used to treat patients who are at high cardiovascular risk, with very high cholesterol, and who cannot lower their LDL enough with available therapies. Together with Genzyme/Sanofi, Isis plans to file a NDA for homozygous familial hypercholesterolemia in the first quarter of 2012. In July of 2011, a marketing authorization application was submitted to the European Medicines Agency seeking approval of Kynamro for homozygous and severe heterozygous familial hypercholesterolemia.
Also in the cardiovascular space, Isis has a promising compound, ISIS-FXI, in a market that is currently valued at over $7 billion dollars. ISIS-FXI is a factor 11 inhibitor and anti-clotting drug that has demonstrated a better profile than current Factor Xa inhibitors that are on the anti-clotting market. In preclinical models, ISIS-FXI has demonstrated potent anti-clotting activity with no increase in bleeding when compared to current therapies such as warfarin, low molecular weight heparin and Factor Xa inhibitors. ISIS-FXI showed it was safe and well tolerated in phase I studies and plans are in place to initiate phase II studies.
The pipeline at Isis is robust and demonstrates the ability of Isis to generate promising compounds.
Program | Partner | Indication | Clinical Trial Status |
Kynamro | Genzyme | High cholesterol | Phase III |
ISIS-CRP | Isis | CAD/Inflammation/Renal | Phase II |
ISIS-APOCIII | Isis | High triglycerides | Phase I |
ISIS-FXI | Isis | Clotting disorders | Phase I |
ISIS-APOA | Isis | Atherosclerosis | Preclinical |
ISIS-FVII | Isis | Clotting disorders | Preclinial |
ISIS-FGFR4 | Isis | Obesity | Phase I |
ISIS-GCCR | Isis | Type 2 diabetes (2 programs) | Phase I |
ISIS-PTP1B | Isis | Type 2 diabetes | Phase I |
ISIS-DGAT2 | Isis | Nonalcoholic steatohepatitis | Preclinical |
OGX-011 | Cancer | Phase III | |
ISIS-EIF4E | Isis | Cancer | Phase II |
LY2181308 | Lilly (LLY) | Cancer | Phase II |
OGX-427 | Oncogenex | Cancer | Phase II |
ISIS-STAT3 | Isis | Cancer | Phase I |
ATL1103 | Antisense Therapeutics | Acromegaly | Phase I |
ISIS-SMN | Isis | Spinal Muscular Atrophy | Phase I |
ISIS-SOD1 | ALS Association, Muscular Dystrophy Association | Amyotrophic lateral sclerosis | Phase I |
ISIS-TTR | GlaxoSmithKline | Transthyretin amyloidosis | Phase I |
ISIS-AAT | GlaxoSmithKline | Alpha-1 antitrypsin deficiency associated liver disease | Preclinical |
Alicaforsen | Atlantic | Ulcerative Colitis | Phase II |
ATL1102 | Antisense | Multiple Sclerosis | Phase II |
EXC001 | Excaliard | Local Fibrosis | Phase II |
iCO-007 | iCO | Ocular Disease | Phase II |
Plazomicin | Achaogen | Severe Bacterial Infection (gram negative) | Phase II |
Isis has a market capitalization of $820 million and currently trading at $8.21 with a 52-week range of $6.25 - $9.49. The company has approximately $65 million in cash and equivalents, $3 million in short-term debt, and $215 million in long-term debt.
Disclaimer: All information is provided for informational purposes only and does not serve as investment advice or an offer of management services. There is no guarantee that the information is accurate. All information is subject to change, amendment, and correction without any notice. Any mention of current and past results does not indicate any future expectations or results. All investments are associated with risks and loss of money. Consult with a professional tax, accounting, legal, and/or investment advisor before making any investment decision.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
