Biotech Strategy Blog

Commentary on Science, Innovation & New Products with a focus on Oncology, Hematology & Cancer Immunotherapy

Posts tagged ‘XOMA 052’

Following on from the recent rise in Xoma shares, that i discussed in yesterday’s blog post, the company announced this morning that they have signed a commercialization deal with Les Laboratoires Servier, France’s largest privately held pharmaceutical company (2010 revenue 3.7 billion euros).

According to the press release, the key elements of the deal are:

  • XOMA will receive approximately $35 million upfront, up to approximately $470 million in milestone payments and tiered royalties up to a mid-teens percentage rate.
  • XOMA retains development and commercialization rights for Behcet’s uveitis and other inflammatory and oncology indications in U.S. and Japan. Servier receives similar rights in the rest of the world.
  • Servier will fund the first $50 million of XOMA 052 development expenses and 50% of further expenses for the Behcet’s uveitis indication. XOMA 052 is expected to advance into Phase 3 development in Behcet’s uveitis in 2011.
  • Servier will fund development for diabetes and cardiovascular disease indications in exchange for worldwide rights.
  • XOMA retains an option to reacquire the development and commercialization rights to the diabetes and cardiovascular indications in the U.S. and Japan by paying an option fee and partial reimbursement of incurred development expenses. If XOMA reacquires these rights, it has the ability to license them to one or more third parties.

It is a large injection of cash into Xoma that will help fund phase 3 clinical trials.  The regional deal also keeps open the possibility of licensing U.S. marketing rights to another partner in the future. The only surprise perhaps is the timing of the announcement which is in advance of the phase 2 clinical trial results for Xoma 052 in diabetes. The expectation from all the signals is that this data will be positive.

There are no guarantees in clinical research, so it will be interesting to see what happens to Xoma 052 as it moves forward in development.

The December 17, 2010 issue of “Science” has the catchy of title of “Insights of the Decade”, one of which is an article by Jennifer Couzin-Frankel, “Inflammation Bares a Dark Side”, that describes the ubiquitous role of inflammation. She concludes that:

“Mediating inflammation in chronic diseases is a new frontier, its success is still uncertain.”

Inflammation has been shown to play an important role in multiple chronic illnesses such as cancer, and in type 2 diabetes it promotes insulin resistance and the death of pancreatic beta cells.  In 2007, Marc Donath and colleagues published a landmark study in the New England Journal of Medicine where he used the drug anakinra, in patients with type 2 diabetes, to block interleukin-1 (IL-1), a cytokine that mediates the inflammatory response. The conclusion of the paper was that:

“The blockade of interleukin-1 with anakinra improved glycemia and beta-cell secretory function and reduced markers of systemic inflammation.”

The finding that diabetes patients whose inflammatory response was blocked did better, has led several companies to work on drug development in this area.

One of these is the biotechnology company, Xoma, whose stocked jumped 200% in the week before Christmas.  Although there was no press release or announcement of any company news, it looks like investors decided to take a gamble that the phase 2 trial results for Xoma 052 in type 2 diabetes will be positive.  As often happens, the wisdom of the crowd, led to others joining the share buying frenzy.

Source: Google Finance. Xoma had previously announced on November 4, 2010 (emphasis added) that:

Enrollment completed in Phase 2a trial of XOMA 052 in patients with Type 2 diabetes:

This randomized, placebo-controlled trial, in which 74 patients were enrolled, is designed to evaluate extended biologic activity and safety of XOMA 052. Outcomes will include diabetes measures such as hemoglobin A1c, or HbA1c, and fasting blood glucose, or FBG, and C-reactive protein, or hsCRP, a biomarker of inflammation associated with cardiovascular risk. Interim results from the first three months of treatment in this six month trial are expected to be announced in the first half of January 2011.

Enrollment completed in Phase 2b trial of XOMA 052 in patients with Type 2 diabetes: This randomized, placebo-controlled dose-ranging trial enrolled 420 patients and is designed to further evaluate the safety and efficacy of XOMA 052 dosed once monthly compared to placebo. The results will include data on measurements of HbA1c, FBG and hsCRP. Top line results are expected to be announced in the first quarter of 2011.

Xoma 052 is a high affinity monoclonal antibody that targets the inhibition of IL-1 beta.  Its ultra-high affinity allows for monthly dosing and lower dose levels which supports patient compliance in chronic diseases. Positive phase 2 results for Xoma 052 in Behcet’s Uveitis was presented in November to the American College of Rheumatology.

According to the November 2010 Xoma Corporate Presentation, the overall market size for diabetes is $22B, of which the IL-1 share is $7B, raising the possibility that Xoma 052 could be a blockbuster if shown to be safe and effective.

Source: Xoma November 2010 Corporate Presentation

Looking at the above, perhaps the rush to buy Xoma stock before the holidays, was perhaps not as much of a gamble as one might think. Xoma 052 is certainly a product to watch this year.

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