Companies desperate for a partner

As investing in companies who have put all their resources behind the development of just one product becomes an even riskier business in the current regulatory and financial climate (One-product companies currently on a knife edge, November 27, 2008), EP Vantage has extended this analysis to highlight 22 companies with 100% of their value assigned to just one unpartnered filed or phase III drug, whose cash reserves are dangerously low and therefore are expected to be desperate for a deal of any sort.

Top of the list is Mannkind, who despite holding a respectable $95m in cash has burnt $90m per quarter so far this year and as such will be working overtime to secure a partner for their inhaled insulin product, Afresa. Other companies in the table (see below), such as Advanced Life Sciences, Bioniche Life Sciences and Repros Therapeutics are also drinking in the last chance saloon and will be praying that clinical data and regulatory reviews prove positive enough to clinch a life-saving deal.

Of the 35 companies originally highlighted in the previous story about one-product companies, the following table includes the 22 companies who have yet to sign a partner for their key drug in a major market. It also excludes Targanta Therapeutics and Arpida on the assumption that their antibiotic drugs have effectively failed to make the regulatory grade and therefore unlikely to attract any further interest.
 

With the jury still out on Mannkind’s Afresa (MannKind keeps the faith in inhaled insulin, September 16, 2008), coupled with the high profile failures of Exubera and other inhaled insulin pipeline products, any partner is likely to wait until approval is granted.

Following Shire’s acquisition of Jerini and ViroPharma’s purchase of Lev Pharmaceuticals, Dyax remains the only independent company developing a new drug for hereditary angioedema, DX-88. Whilst a takeover remains a possibility, Dyax so far seems determined to commercialise its drug alone, although investors are likely to wait for approval, due in March 2009, before contributing more cash (Dyax looking strong ahead of second attempt in HAE race, August 19, 2008).

Of the companies with the smallest current cash reserves, Aastrom Biosciences, Advanced Life Sciences, Bioniche Life Sciences and Oxigene have all made it quite clear to the market that they are actively seeking a partner and are at various stages of discussions. 

As such, the phase III data for their respective products, or in the case of Advanced Life Sciences the FDA’s review of cethromycin for community acquired pneumonia, has to be positive otherwise even the short-term future of these companies will be in doubt.