Biotech: Action Follows Recent Jump in Share Price
Shares of Alliance Pharmaceutical Corp. fell slightly following news that a Massachusetts rival beat the San Diego-based biotech firm to the market with the first blood substitute ever approved.
Alliance stock closed at $3.75 on April 11, down 20 cents from the previous day when Cambridge, Mass.-based drugmaker Biopure Corp. said it won government approval for its blood substitute Hemopure in South Africa.
The news sent Biopure’s stock up 27 percent to close at $19.77 after the announcement in Johannesberg on April 10.
Just one day earlier, Alliance’s stock surged 33 percent after it reported patients treated with its blood substitute Oxygent needed half as many units of blood in transfusions during surgery than those not treated.
Alliance suffered a major setback in January when it decided to halt a heart-surgery clinical study after unexpected complications arose.
On March 13, Alliance stock recovered, rising 58 percent, after the firm announced it would continue to develop Oxygent with partner Baxter International Inc. in Deerfield, Ill.
The firm is still debating whether to continue the Phase III trial or start an entirely new trial, said Gwen Rosenberg, an Alliance spokeswoman.
Biopure said it will file for approval from the U.S. Food and Drug Administration and European regulatory authorities in June.
Two Years Before Approval
Alliance, by contrast, won’t be in a position to file for regulatory approval for about two more years.
But Rosenberg said company officials aren’t concerned about Biopure seeking European and U.S. regulatory approval first.
“It’s good for the industry that an oxygen carrier has been approved somewhere,” Rosenberg said. “But the approval was in South Africa and that doesn’t impact approval in the U.S. or Europe.”
John McCamant, editor of the Medical Technology Stock Letter in Berkeley, agreed.
Because Hemopure is made from cow’s blood, European and U.S. approval will be problematic given the threat of spreading mad cow and foot-and-mouth disease from Europe, McCamant said.
He added that doesn’t mean Alliance’s synthetic blood substitute has a better chance of gaining approval in the United States or Europe.
Oxygent has yet to show efficacy, or a strong benefit, McCamant said. He predicted it will take years before a blood substitute will be approved in the United States.
Remains Optimistic
Rosenberg, however, remains optimistic Alliance will prevail even if Biopure hits the marketplace here first.
She said Alliance’s product will be priced at about $300 per unit , that is three to four times lower than the cost of Hemopure’s product.
She also listed lower production costs, larger manufacturing capabilities, and the Oxygent product containing no human or animal blood among Alliance’s strongholds.
She cited Alliance’s partnership with Baxter, the second-biggest maker of medical supplies, among the firm’s power points, she said.
Baxter has an exclusive license for sales of Oxygent in the United States, Canada and Europe with an option to manufacture the product.
