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Biotech Isis licenses its costly diabetes drug development



Biotech: Shareholders, Firm to Benefit From

$50M in Payments

One biotechnology expert believes Isis Pharmaceuticals, Inc.’s shareholders are likely to benefit from a deal between the Carlsbad-based biotechnology firm and a major drugmaker to develop its diabetes drug candidate.

Isis announced May 23 it struck a licensing agreement shifting the costly development of its preclinical Type II diabetes compound to New Jersey-based drug giant Merck & Co.

Dr. Stanley Crooke, Isis’ chairman and CEO, said the “drug candidate attracted broad interest from the pharmaceutical industry.”

But Merck’s expertise in chronic disease treatment and “extremely attractive” financial terms sealed the deal, he said.

Crooke said Isis will recognize $10 million worth of revenues based on Merck’s initial payment and can expect $50 million in milestone payments over the next few years.

He declined to comment on the percentage of potential royalties from Merck if the drug candidate was to hit the market.

John McCamant, editor of the Berkeley-based Medical Technology Stock Letter, is optimistic. “You don’t always see a licensing agreement this early in development,” McCamant said. “There was a lot of interest, because Isis could show the mechanism of action (in) how they got to (develop) this drug. That may be some of the power of antisense technology.”

The antisense approach is unique, because it manipulates segments of the genetic code to block disease-related genes.

Isis’ drug candidate ISIS 113715 was designed to block PTP-1B, a gene that regulates the body’s use of insulin.

Crooke said PTP-1B continues to be a challenging target for drugmakers.

Most pharmaceutical firms focus on small molecules because they are known to make their way into cells quickly.

Antisense, however, is more specific.

In animal studies, ISIS 113715 has been shown to effectively block PTP-1B normalizing blood glucose and insulin levels, Isis reported.

In rodents, ISIS 113715 decreased blood glucose levels with just a once a week dose, Isis reported.

As of now, there aren’t any effective drugs to treat the many Type II diabetics, Crooke said.

Most patients start out with oral drugs, but are forced to move to daily insulin injections as the disease progresses, he added.

Some 16 million Americans are affected by diabetes; 90 percent suffer from Type II diabetes, Isis said.

The rising number of older Americans and greater prevalence of obesity and sedentary lifestyles make for a tremendous market of an effective Type 2 diabetes drug, McCamant said.

The market opened up even further since Parke-Davis, now Pfizer, was asked by the Food and Drug Administration to stop selling its Type II diabetes drug Rezulin after emerging reports of liver failure causing 61 deaths.

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