IntelGenx Striving To Create A Second Biovail

| About: IntelGenx Technologies (IGXT)

Drug developer IntelGenx (OTCQX:IGXT) has its sights set on emulating the success of high flying, drug delivery company Biovail, before its merger into Valeant Pharmaceuticals (NYSE:VRX), and founder and CEO Horst Zerbe thinks his company is almost there.

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Horst Zerbe, Ph.D

"Like Biovail in its heyday, we have proprietary and unique drug delivery technologies, we provide regulatory services, and we have successfully compiled and submitted new drug applications and received approvals," he said in an interview with, referring to the company's mission of making approved drugs better.

"Where we fall short is that Biovail had its own contract research organization to conduct clinical studies. We can't do that yet. The other area where we fall short is in the manufacturing area. Right now, we rely on manufacturing partners," he pointed out.

Dr. Zerbe explains that one of IntelGenx's drug delivery platforms - a rapidly dissolving film placed in the mouth called VersaFilm - is very high tech, compared with other pharma technologies like tablets. "Only a handful of contract manufacturing organizations can make them, and strategically, it would be important for us to gain a degree of manufacturing independence," he said.

Asked whether IntelGenx will pursue a manufacturing base in time, he said, "Absolutely."

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IntelGenx Platform Technologies

In addition to VersaFilm, IntelGenx's platform technologies include a multi-layered controlled-release tablet, known as VersaTab, and an adhesive flat tablet or wafer, which is placed in the oral cavity, known as AdVersa. Compared with oral films, which offer immediate release, AdVersa's drug release can be customized, which enhances drug absorption and permeability in the mouth.

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Key IntelGenx Projects

IntelGenx's lead product is Forfivo XL. At 450 mg, it is a high dose, controlled-release version of the antidepressant Wellbutrin XL and its active ingredient, bupropion, which had branded and generic sales of $745-million in 2011.

IntelGenx and its marketing partner, Edgemont Pharma, are gearing up for a target launch of Forfivo XL at the end of the third quarter or early in the fourth quarter. The accord gives IntelGenx milestone payments of $28.5-million and double-digit tiered royalties on net sales. Dr. Zerbe says Edgemont has a strong track record in commercializing neurological products.

There are no medications now on the market with 450 mg of bupropion in a single tablet. As a result, psychiatrists have to prescribe three 150 mg tablets for patients, increasing the risk of accidental overdosing which, in turn, can lead to significant complications such as seizures.

Originally known as CPI-300, Forfivo XL received unconditional FDA approval in November last year. The FDA isn't requiring IntelGenx to include a safety warning in the patient leaflet, since the high dose formulation removes the need for multiple dosing. The drug also has no food effect and can be taken with or without food.

IntelGenx is forecasting income from CPI-300 in 2012 of $2-million, climbing to more than $7-million in 2014, when Forfivo XL sales are estimated to reach $30-million. "2012 is a breakthrough year for the company, because we believe this launch will make us cash flow positive this year, and it is sustainable," Dr. Zerbe says.

Best known for its research of rapidly dissolving thin films, IntelGenx's VersaFilm offers "attractive lifecycle management opportunities for Big Pharma to extend brand exclusivity of a franchise product," Dr. Zerbe contends. The film features rapid onset of action; improved bioavailability or less initial metabolism by the body; convenient administration, making it ideal for children and seniors or when swallowing is an issue; and improved patient compliance.

IntelGenx has demonstrated bioequivalence of its oral VersaFilm against FDA-listed reference drugs in the areas of migraine, erectile dysfunction and insomnia.

Dr. Zerbe says the company has achieved bioequivalence of its lead INT0008 migraine film with Merck's rizatriptan Maxalt MLT. The film is now undergoing a pivotal stability study, with a 505(b)(2) new drug application expected to be filed with the FDA in the first quarter of 2013. The company's co-development partner, RedHill Biopharma, is covering the costs of development, while IntelGenx is responsible for technical and regulatory execution.

IntelGenx anticipates launching its rizatriptan film in 2014, with U.S. gross sales reaching $32.5-million in the fourth year after launch. "We are discussing term sheets with marketing partners and seeing quite a bit of interest," Dr. Zerbe says.

For erectile dysfunction, IntelGenx has shown that its INT0007 film is bioequivalent with the reference-listed drug Cialis. "We have decided to develop our film product alone and are talking to several companies interested in a commercialization deal," he says. The ED film is forecast to reach U.S. sales of $120-million in the sixth year after launch, with the company aiming to submit a 505(b)(2) new drug application with the FDA in 2013.

Dr. Zerbe says insomnia is the second most common medical complaint after pain, and the company's INT0020 film is designed to overcome the inconvenience of taking conventional sleeping pills. Americans spend well in excess of $7-billion on prescription sleep aids.

While an insomnia bioequivalence study had positive results, Dr. Zerbe says the company is currently finishing taste-masking tests to address the bitter taste of the reference-listed drug. "We are seeing strong interest in this product," he adds. IntelGenx figures that its insomnia film could achieve sales in excess of $50-million in the fifth year after launch.

IntelGenx has also partnered with Par Pharmaceuticals (NYSE:PRX) on its INT0027 project. No details have been disclosed about the project, but Dr. Zerbe says a regulatory submission is planned for this year.

For pain, the company is developing an AdVersa mucoadhesive dissolving tablet that combines the opioid, buprenorphine, and dronabinol, or THC, which is the active ingredient in marijuana. THC has been approved by the FDA for nausea in cancer patients and is known to be an effective agent for pain management.

Dr. Zerbe explains that THC is chemically unstable, and as a result, there are no tablet products on the market to replace existing oral sprays and oily solutions. "We have developed patent-protected technology to stabilize the molecule sufficiently to formulate an adhesive tablet, with an oral release and absorption," he adds.

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Buprenorphine/Dronabinol Combination

He also points out that with the AdVersa delivery system, the bioavailability of THC can be increased and the presence of the psychoactive metabolite reduced, compared with the marketed alternative, Marinol. "The main advantage of the buprenorphine-THC combination is a synergistic effect that leads to a significant increase in pain reduction," he contends. "We are targeting a very attractive market with a blockbuster potential of $1-billion in sales for various indications such as cancer and neuropathic pain."

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In animal health, Dr. Zerbe says the company is developing an adhesive film, known as VetaFilm, to facilitate dosing directly on the oral mucosa or on a pet's favorite treat. "This is an elegant method of administering drugs to animals, because the sticky film is designed to adhere on contact so that the pet can't spit it out like tablet medications," he says, adding that it could also remove the need for syringe injections.

"We see significant interest by a U.S. animal health company in this novel delivery system," he adds.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.