Ipsen turnaround awaited as pipeline setbacks mount

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Amid continuing uncertainty around the future of diabetes drug taspoglutide, Ipsen has terminated one of its few pipeline programmes attracting sales forecasts - acromegaly treatment BIM 23A760 (dopastatin). The company will instead focus on expanding the uses of its existing acromegaly therapy, Somatuline, which loses patent protection in five years.

For pipeline progress, greater attention is now likely to be paid to the progress of OBI-1, which recently entered phase III for haemophilia A, an area of growing activity. Meanwhile Roche's decision on taspoglutide, expected early next year, remains an important event on the horizon. With shares in the French company at a record low since going public five years ago, a statement of renewed ambition is also keenly awaited from new chief, Marc de Garidel, who faces the daunting task of spearheading a turnaround.

Unable to inhibit

Acromegaly results from an overproduction of growth hormone, usually due to a benign tumour in the pituitary gland, which causes excessive growth in the extremities, as well as bones and cartilage, and trapped nerves. It can cause serious cardiovascular and joint-based disorders if left untreated, and causes abnormal growth in children.

BIM 23A760 is a chimeric compound comprising a somatostatin analogue and dopamine agonist. It was designed with the theory that these two receptors act synergistically, enhancing somatostatin inhibitory effect on growth hormone and IGF-1. However, repeated dosing was unable to achieve the level of inhibition Ipsen hoped for.

Despite only reaching phase II, the candidate was already forecast to sell $36m in 2016, meaning Ipsen has lost a product with a net present value of $171m, or 7% of its market cap, according to EvaluatePharmadata.

Shares in Ipsen fell 5% yesterday to €22.30, and have edged slightly lower again today, to €22.25.

Focus on predecessor

Focus now turns to predecessor Somatuline (lanreotide), an uncombined somatostatin analogue which is approved for treating acromegaly and sold nearly $200m last year. This candidate is still Ipsen’s second biggest growth driver, projected to sell $361m in 2015, the year it loses protection from generic competition.

Somatuline is undergoing phase III trials for functioning neuroendocrine tumours in the US, and non-functioning neuroendocrine tumours, which the company says would make it the first somatostatin candidate approved for this indication; the trial will be complete in June 2013.

Further research with Somatuline is being conducted on an improved delivery device seeking to increase safety while maximising the administered dose. Work is also being carried out on a novel formulation, providing a better version of the compound when its composition of matter patent expires.

Growing interest

Growing pharma interest in haemophilia could be Ipsen’s lifeline. OBI-1, a recombinant Factor VIII partnered with Inspiration Pharmaceuticals and granted orphan drug status, targets haemophilia A, which comprises the majority of haemophilia cases.

A phase III study of OBI-1 was started last month in acquired hemophilia A patients who have developed resistance to human Factor VIII, due to complete in 2013. That OBI-1 is a recombinant porcine version of Factor VIII is a necessary attribute in its space, as a third of acquired hemophilia A patients develop resistance to human forms of the coagulation factor.

This would pit it against other recombinant forms of Factor VIII – Baxter’s market-leading Advate, which sold $1.7bn last year and is projected to sell $2.8bn in 2016, Bayer’s Kogenate, which sold $1.2bn last year but loses patent protection in four years and CSL’s Helixate, which sold nearly $500m last year but loses protection from generics in five years.

Consensus data is not yet available, although analysts at French bank Natixis have pencilled in peak sales of $200m. Ipsen has a 22% stake in Inspiration, which has full rights to the compound, and could pay $174m in milestones to Ipsen – the French company received $50m for the phase III initiation – plus a sizeable 27% royalty rate.

Fresh vision

New chief executive Mr de Garidel has been charged with establishing a big presence in the US, and building Ipsen’s work in emerging markets. His biotechnology expertise has been flagged as a major asset to the company, and although his history as a big pharma executive is not dissimilar to that of former chief Jean-Luc Bélingard, perhaps his entry to the role can be seen as a fresh set of eyes for an ongoing agenda.

Unfortunately Ipsen has few events on the horizon that might yield good news; Roche’s decision on taspoglutide in the first quarter next year is not expected to be positive (Taspo suspension appears terminal, September 13, 2010).

For things to improve, attention needs to shift from endocrinology to haemophilia, which will hopefully start to show greater long-term value. And with the taspo decision behind it, which ever way it goes, 2011 needs to begin with fresh vision from a new boss.

Product Somatuline  OBI-1
Trial ID NCT00353496 NCT01178294

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