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Stellar plugging bladder wall around the world

|Includes: Stellar Pharmaceuticals Inc. (SLXCF)

Stellar plugging bladder wall around the world

November 17, 2009 by leonardzehr · Leave a Comment 

In 2003, Lana Tenney began chemotherapy following her breast cancer surgery.  And as stressful as that was, things quickly worsened.  She developed a side-effect from chemotherapy called cystitis, a painful bladder condition that oncologists see in 10%-to-15% of cancer patients, who feel an urge to urinate 20-to-30 times a day, whether they can or can’t.

Uracyst® (a sterile sodium chondroitin sulfate solution, 2%) for the treatment of interstitial cystitis/painful bladder syndrome ("IC/PBS")Luckily, her husband Arnold was chairman of upstart Stellar Pharmaceuticals (OTCBB:SLXCF (1.15 ↑4.55%)), which had a product on the market called Uracyst to treat interstitial cystitis.

“I spoke to Lana’s oncologist, told him what was in it and he figured there was nothing there that could hurt her,” he recalls in an exclusive interview with BioTuesday.ca.  “She started treatments with Uracyst on a Monday and by the weekend, the symptoms had disappeared.”

Mrs. Tenney remembers the terrible pain from cystitis and the quick relief from Uracyst.  “It saved my life. The pain was horrible. I didn’t want to leave the house because I always felt I had to go to the washroom.”

And when her chemotherapy ended after six months, so did the cystitis, ending the need to take Uracyst.

Peter Riehl, StellarPeople like Mrs. Tenney, who develop chemically-induced cystitis, represent only a small segment of Stellar’s target market, which is interstitial cystitis or IC, says Stellar CEO Peter Riehl.  But one fact remains constant: anyone touched by the disease goes through hell.

“If you talked to IC patients that had the disease for four-or-five years, and were bounced from physician-to-physician, without anything working for them, and then they took Uracyst and it worked, that would ring home loud and clear,” he adds.

IC is thought to be caused by microscopic defects in the mucous lining of the bladder, which allow toxins in urine to seep through and irritate the bladder wall, resulting in a pressing need to urinate and pain.

Diagnosing the problem tends to be difficult and is often made by testing for and then excluding other possibilities like bacterial cystitis, cancer and cysts in the urinary tract.  From the onset of symptoms to a diagnosis can take five-to-eight years on average, which explains why some patients develop psychological problems, Mr. Riehl points out.

Uracyst appears to be gaining a competitive advantage over other less effective treatments because new research suggests that chondroitin sulphate, the active ingredient in Uracyst, repairs the defects in the bladder wall, known as the GAG layer, and re-establishes the bladder barrier function.

Dr. Curtis Nickel, a leading urologist and researcher at Queen’s University, told a recent meeting of the American Urology Association that results of several recent studies with Uracyst suggest that chondroitin sulfate improves symptoms in patients with IC and painful bladder syndrome.

The IC patient population, of which 90% are women, is growing.  Just a few years ago, estimates put the U.S. market at about 1.5 million people, but a new report by the Rand Group pegs the number between 3.4 million and 7.9 million.  A lot of that is being driven by greater awareness and the aging population.  Even more men, misdiagnosed with benign prostatitis, are now falling into the IC patient pool.

“And we are now beginning to find that things like over active bladder have a GAG component to it,” Mr. Riehl says, with research pointing to chondroitin sulphate, the active ingredient in Uracyst, as a more effective therapy.

London, Ont.-based Stellar sells Uracyst in Canada through its own sales force.  The drug is also being sold in Italy, Belgium, Luxemburg, the Netherlands, Denmark, Sweden, Norway, Finland, Iceland, Turkey, the U.K. and Ireland, through licensing agreements.  Stellar also has distributors in place and is awaiting regulatory approvals in Israel, the U.S., China and South Korea.

Mr. Riehl is happy with the initial take-up of the drug in Europe this year, and predicts sales will pick up next year.  “We think the European market has tremendous potential.”

In the U.S., Stellar has licensed Uracyst to Watson Pharmaceuticals (WPI 42.37 ↓2.80%), which is conducting a Phase 2 study to set protocols, among other things, for a pivotal marketing trial that could start next year.  “This product could do $100 million a year or better in the U.S. and even more in Europe,” he predicts.

NeoVisc® is a 1.0% solution of highly purified Sodium HyaluronateThe company also markets a treatment for osteoarthritis called NeoVisc, which is given as single-dose or three-dose injections into the synovial space of joints, improving lubrication and mobility, and reducing pain.

NeoVisc is a highly purified solution of hyaluronate, a naturally-occurring substance found in the body and has been clinically available in Canada since 1997.  The treatment stimulates the body to produce its own healthy hyaluronate in the joint.

While there are nearly two dozen competing treatments on the market in Canada and the U.S., Mr. Riehl points out that NeoVisc is the only one that contains a form of hyaluronate that is less likely to cause sensitivities or allergic reactions.

“The single-dose product may open up partnering opportunities in the U.S. for both our single- and three-dose products.  In Europe, our three-dose product is approved and we are looking to do the same thing with the single-dose,” he adds.

Stellar has posted four consecutive profitable quarters and in the first nine months had profit of $215,749 or one cent a share, compared with a year earlier loss of $227,114 or one cent.  Product sales jumped to $2.3 million from $1.5 million.

Stellar Pharmaceuticals (<a href='https://seekingalpha.com/symbol/SLXCF' title='Stellar Pharmaceuticals Inc.'>OTC:SLXCF</a>) 12-month stock chart

Mr. Riehl said these results demonstrate that Stellar’s strategy of building Canadian sales through its own sales force and then expanding through global partnerships is working.  The company is in 58 different markets now with either licenses or approvals.

“Without the Canadian market, we would not have had the funds to expand the way we have,” he contends.  “And as international markets come online, we have very few fixed costs associated with them, so income we generate globally will start to flow directly to the bottom line.”

That will put Stellar in a position to reinvest through development, acquisition of products or even a company that has a similar niche focus, he adds.

While he doubts the company is close enough to pull off a deal next year, simply because of the timelines involved, he acknowledges that Stellar has “strategies in place that would take us there in 2011.”



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