EP Vantage interview - Critical months await e-Therapeutics

Interviews

With early and mid-stage trials for four candidates starting in 2012, the next two years will be pivotal for UK drug developer e-Therapeutics. Key data readouts starting at the end of this year will help to validate the company’s technology and business strategy, which relies on network analysis of disease processes to develop molecules that target multiple proteins.

The initiation next month of phase I trials of ETS2101 in solid tumours and glioma signals a shift toward oncology for the firm, which also has anti-infectives and CNS compounds in or about to enter the clinic. However, chief executive Malcolm Young tells EP Vantage that a £17m ($27m) fundraising last year will enable the Newcastle-based group to get all four products to key milestones, due in Q4 and and early next year, without needing to top up its coffers or sign away rights (Vantage Point - UK life sciences sector suffering from dire start to year, February 15, 2011).

“Our proposition had become quite easy to understand,” Mr Young says. “With good looking clinical candidates most of the clinical programme could get to the point of a fairly clear (biological) signal in that time. The upside is potentially very large. In terms of downside protection we’re in a different situation compared to other biotechs in that our core IP has not only applications in pharma and biotech but also in IT for example.

“I don’t feel rushed toward doing a bad deal on a product which is really quite valuable,” Mr Young says.

Windfall

Larger than expected, last year's fundraising enabled e-Therapeutics to take on a more ambitious clinical programme than the modest one the company had been anticipating. At the end of 2010, it held just $2m in cash, constraining its ability to initiate clinical work (European companies hoping for a Christmas bonus, December 21, 2010). The hope was to raise enough money to move ETS2101 through to the end of phase II.

“We were gearing up for a modest clinical programme,” Mr Young says. “We were worried by the environment around us and we felt that investors had probably had enough in the UK of harum-scarum biotechs.”

In addition to netting more than hoped for, the sale was seemingly well received on the market, with the company’s AIM-listed shares rising 47% to 36p the week it was announced. Shares fell back in generally negative market conditions in August 2011 and now stand at 28p, valuing the company at £39m ($61m).

With the revenue, the company will have four active clinical programmes in 2012. In addition to ETS2101, this year the anti-infectives ETX1153c and ETX1153a will be starting phase I, the former in the challenging hospital-associated infection clostridium difficile and the latter in treating equally challenging skin infections from methicillin-resistant staphylococcus aureus (MRSA). Depression candidate ETS6103, meanwhile, will be able to advance into a phase IIb dose-ranging trial.

“Lots of these programmes were pretty much ready to go but were waiting on potential partners,” he says. “What happened with the large placing we had is that all of these things kicked into full scale life.”

In addition, investors were keen to see e-Therapeutics take advantage of its drug discovery IP, so executives have set a goal of bringing at least one new molecule into development by 2013.

On the horizon

The most immediate catalysts are likely to be data in C. diff and interim findings from the ETS2101 trials, both expected in the fourth quarter of 2012. In 2013, full data are expected from both ETS2101’s US-based glioma trial and its UK-based solid tumour trial, as well as the MRSA and depression studies. Glioma may be a particularly promising field, as it remains an unmet medical need; many chemotherapies struggle to have an impact as they cannot breach the blood-brain barrier, whilst ETS2101 has shown it can.

Mr Young acknowledges the current lineup is rather mixed, which came as a result of the company trying to prove itself in an initial wave of discovery that also included products such as the now “parked” atherosclerosis drug ETX6107.

“In the first phase we were definitely trying to establish bona fides. Now we’re much more focused on those areas where we can make much more important progress,” Mr Young says. “I think it’s pretty obvious to everyone that the cancer programme is where our heads are at now.”

The current focus came about as a result of the addition of Steve Self to the staff, a former group R&D director of Merck KGaA, who put the company’s portfolio under review and came up with the group of four active candidates based on commercial potential, IP protection and ability to be developed by a small biotech. Amongst those on the shelf are analgesic ETX6218 and asthma drug ETX9101. “Some of those things we had are, theoretically, absolutely cracking, but could not be developed by a small company,” Mr Young says. “Cardiovascular would have been tough.”

Focus or not, with such an early stage portfolio e-Therapeutics remains a long way from having a successful product. With the number of binary catalysts on the horizon, it will not be long before it is clear whether it will live up to its promise or join the long list of ill-fated UK biotechs.

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