Event - AMT hoping to make history with gene therapy approval

Although the history of gene therapy is littered with companies that have come close and failed, Amsterdam Molecular Therapeutics today reaffirmed its belief that the road ahead looks clear for a possible positive recommendation from European regulators for its lead candidate, Glybera, a treatment for the orphan condition lipoprotein lipase deficiency (LPLD).

A decision about Glybera is expected in either June or July and if AMT’s faith is rewarded the company could be well on the way to claiming its place in the history books as the first western company that actually cracked gene therapy. The statement by AMT, however, failed to ignite investor appetite for the stock, with shares in the group flat in late afternoon trading at €1.92, indicating just how risky gene therapy is still viewed. The proof in the pudding is still firmly in the eating when it comes to this technology, and little can be expected from the stock until a green light is given.

What might put a little fire under the shares in the short-term is additional efficacy data AMT expects to present at the American Society of Gene and Cell Therapy conference next week, which could also see it outline a potential biomarker for LPLD that outlines the severity of the disease in patients.

Product Glybera
Company Amsterdam Molecular Therapeutics
Market cap $62m
Product NPV $135m
% of market cap 219%
Event type EU CHMP decision
Date Mid-2011 (likely June or July)

Validation

LPLD, which is thought to affect only 1 in 500,000 to 1 in 1,000,000 people is a disorder where triglycerides, the fats found in a normal diet, are not metabolised resulting in a build up of fatty deposits under the skin, abdominal pain and pancreatitis, a potentially lethal illness. At present the only treatment for sufferers is a strict low fat diet.
Glybera works by using an adeno-associated virus as a carrier to replace the faulty gene missing in LPLD patients.
Approval for AMT would not only be a history making feat, but validate the group’s technology, which is also behind AMT-060, a phase II candidate for haemophilia B.

As sales of Glybera are forecast to peak at $99m in 2014, mainly due to the size of the patient population and the fact that if the drug works, there will be no repeat sales, having a much larger patient population to address with its technology will be very useful for future sustainability.

Partnering opportunities

Success with Glybera would also almost certainly attract the attention of big pharma, which has dabbled at the edges of the field, with small deals with the likes of Oxford BioMedica and GenVec, but not fully committed to the risky technology - understandable given the failures to date.

But while the haemophilia product maybe up for grabs for partnering, AMT estimates it would only need 10 sales reps to market Glybera in Europe, meaning it is most likely to go it alone. Having already shouldered all the costs and the risks, if the product is approved in Europe crystalising all the sales would be appropriate and full reward.

These revenues will be welcome because although the group’s cash position improved with a fundraising in October, which raised €14.3m, leaving it with cash and cash equivalents of €17.9m at December 31, last year AMT spent €16.4m on R&D and current cash is only expected to last for 12 months.

However, the group would almost certainly turn back to the markets again if Glybera made it past the European regulators. Strengthening its cash position would also strengthen its hand in any partnering deals, ahead of US filing, expect at the end of 2011 or early 2012, and a Canadian filing this year.

The hopes of gene therapy now sit heavily on the shoulders of AMT, in terms of getting a product approved. If it succeeds it could open the doors to a whole new approach to disease treatment, as such many other players in the field will be watching and waiting for the European regulator’s decision.

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