Healthcare Industry News: IntraBiotics Pharmaceuticals
News Release - December 22, 2006
Company Announces Acquisition of Research and Development Programs, Hiring of Senior Management Team and Name ChangeCompany to Develop Novel Treatments for HIV, Cancer and Inflammatory Disease
SAN DIEGO, Dec. 22 (HSMN NewsFeed) -- Ardea Biosciences, Inc., formerly known as IntraBiotics Pharmaceuticals, Inc., (Pink Sheets: IBPI ) today announced that it has acquired significant intellectual property and other assets from Valeant Pharmaceuticals International (NYSE: VRX ) and hired a new senior management team. With these developments, the Company plans to pursue three pharmaceutical programs focused on the development of novel treatments for HIV, cancer and inflammatory diseases. The Company changed its name to Ardea Biosciences, Inc. effective December 21, 2006 and expects that its common stock will be traded under the new name and a new ticker symbol (to be assigned by Nasdaq) in the near future.
Acquisition of Research and Development Programs
On December 21, 2006, the Company signed a definitive asset purchase agreement with Valeant. Under this agreement, the Company acquired substantially all of the assets, including intellectual property, preclinical data, product inventory, and research equipment, necessary for the Company to pursue three distinct pharmaceutical research and development programs. The three programs are:
* 800 Series Program. The 800 Series Program is the Company's lead program, currently in late preclinical development, and is directed toward the discovery of non-nucleoside reverse transcriptase inhibitors (NNRTIs) for the potential treatment of HIV. The lead clinical candidate from the program is AR806. In vitro preclinical tests of AR806 have shown it to be a potent inhibitor of a wide range of HIV viral isolates, including isolates that are resistant to efavirenz (Sustiva®, Bristol-Myers Squibb) and other currently available NNRTIs. Based on early in vitro and in vivo preclinical data, the Company anticipates that this compound could have a pharmacokinetics profile that would support formulation as a once-daily oral drug, may have limited pharmacokinetic interactions with other drugs, and may be readily co-formulated with other HIV antiviral drugs. The Company plans to initiate a Phase I clinical study of AR806 in 2Q 2007.
* 900 Series Program. The Company's 900 Series Program, which is in early preclinical development, is also directed toward the discovery of NNRTIs for the potential treatment of HIV. The compounds in the 900 Series Program are from a chemical class that is distinct from the chemical class being investigated in the 800 Series Program. Based on early preclinical data, the Company believes that the compounds in the 900 Series Program may have the potential to improve the positive attributes of the compounds in the 800 Series Program. Namely, they appear to have greater activity against a wide range of drug-resistant viral isolates, may have the potential for once-daily oral dosing, and may be readily co-formulated with other HIV antiviral drugs. The Company hopes to be able to select a development candidate from this program in early 2007 and to initiate a Phase I clinical study of this candidate in 4Q 2007.
* 100 Series Program. The Company's 100 Series Program, which is in preclinical development, is directed toward the discovery of small- molecule kinase inhibitors for the potential treatment of cancer and vinflammation. AR119 is the Company's lead development candidate from the 100 Series Program. In early preclinical tests, AR119 has shown potential as a potent and selective inhibitor of MEK (Mitogen-activated ERK Kinase), which is believed to play an important role in cancer cell proliferation, apoptosis and metastasis as well as inflammatory cell signaling. Preclinical data suggest that AR119 may have favorable pharmaceutical properties, including the potential for once-daily oral dosing. The Company hopes to initiate a Phase I clinical study of AR119 in 3Q 2007.
Management Team and Development Organization
In connection with the launch of the research and development programs, the Company is pleased to announce that it has hired three key individuals to form a newly constituted management team. To support this new management team, the Company is in the process of hiring approximately 50 additional people, many of whom formerly worked on the acquired programs at Valeant. Once this hiring process is complete in early January 2007, the Company expects to have a fully-integrated research and development organization. The Company is moving its corporate headquarters to San Diego, CA, and its research facilities will be located in Costa Mesa, CA.
The Company's new management team brings together extensive experience in the development and commercialization of pharmaceutical products for the treatment of HIV and cancer. The team is comprised of the following executives:
Barry D. Quart, Pharm.D., President, Chief Executive Officer and Director. The Company has appointed Barry D. Quart, 49, as President and Chief Executive Officer. Dr. Quart has also been elected to the Company's board of directors. Dr. Quart has been President of Napo Pharmaceuticals, Inc. since 2002, which went public on the London Stock Exchange in July 2006. Prior to Napo, Dr. Quart was Senior Vice President, Pfizer Global Research and Development and the Director of Pfizer's La Jolla Laboratories. Prior to Pfizer's acquisition of the Warner-Lambert Company, Dr. Quart was President of Research and Development at Agouron Pharmaceuticals, Inc., a division of the Warner-Lambert Company. Dr. Quart joined Agouron in 1993 and was instrumental in the development and registration of nelfinavir (Viracept®), which went from the lab bench to NDA approval in 38 months. Prior to Agouron, Dr. Quart spent over ten years at Bristol-Myers Squibb and was actively involved in the development and registration of important drugs for the treatment of HIV and Cancer, including paclitaxel (Taxol®), didanosine (Videx®), and stavudine (Zerit®). He has a Pharm.D. from University of California, San Francisco.
Zhi Hong, Ph.D., Executive Vice President, Research and Chief Scientific Officer. The Company has appointed Zhi Hong, 43, as Executive Vice President, Research and Chief Scientific Officer. Dr. Hong was previously Vice President of Research at Valeant, which he joined in 2000. During his tenure with Valeant, Dr. Hong directed both the virology and cancer/immunology programs and held leadership positions on the HBV, HCV and HIV project teams that led to four US investigational new drug (IND) applications in six years. Prior to joining Valeant, Dr. Hong was with Schering-Plough Research Institute. He is an expert in viral replication and a renowned investigator in the mechanism of action of ribavirin and interferon. Dr. Hong received a B.S. in Biochemistry from Fudan University in Shanghai, China and his Ph.D. from the State University of New York at Buffalo. Dr. Hong has authored/co-authored close to 100 research publications in peer-reviewed journals and has been involved in the issuance and/or publishing of more than 40 patents.
Kimberly J Manhard, Senior Vice President of Regulatory Affairs and Operations. The Company has appointed Kimberly J. Manhard, 47, as Senior Vice President of Regulatory Affairs and Operations. Ms. Manhard has been President of her own consultancy since 2003, specializing in the development of small molecules intended for antiviral, oncology, central nervous system, and gastrointestinal indications, and was responsible for filing five initial US INDs and multiple clinical trial applications in the European Union and Canada. Prior to starting her consultancy, Ms. Manhard was Vice President of Regulatory Affairs for Exelixis, Inc. Previously, she was Head of Regulatory Affairs for Agouron Global Commercial Operations (a Pfizer Company), supporting marketed HIV products. She joined Agouron in 1996 as Director of Regulatory Affairs and was responsible for anticancer and antiviral products, including nelfinavir. Prior to Agouron, she was with Bristol-Myers Squibb for over 5 years in Regulatory Affairs. She earned a B.S. in Zoology and a B.A. in French from the University of Florida.
Denis Hickey, Chief Financial Officer. Denis Hickey, 62, has resigned as the Company's Chief Executive Officer and will continue as Chief Financial Officer. Mr. Hickey had been the Company's Chief Executive Officer since June 2005, when the Company ceased all operations, and was subsequently appointed as Chief Financial Officer. Mr. Hickey is a founding principal of Hickey & Hill, Inc., a firm that specializes in the management of companies in transition. Mr. Hickey has served as CEO, CFO or Controller for a number of companies. Mr. Hickey also has public accounting and consulting experience with Touch Ross & Co. (now Deloitte & Touche, LLP).
The Company believes that there is a significant market opportunity for its products, should they be successfully developed, approved and commercialized.
In 2005, the worldwide market for HIV antivirals was estimated at approximately $8.0 billion, according to data from IMS Health Incorporated's Retail Drug Monitor. While the treatment of HIV has improved dramatically over the past decade, there remains a need for new treatments that are effective against drug-resistant virus, well-tolerated and convenient to take. The Company believes that its 800 and 900 Series NNRTIs have the potential to meet this market need.
The Company believes that there is a growing interest in the potential for targeted therapies, including kinase inhibitors, in the treatment of both cancer and inflammatory disease. In 2005, the worldwide market for targeted therapies for cancer was $7.5 billion, according to Datamonitor plc, and the worldwide market for targeted therapies for inflammatory diseases was more than $8 billion, according to data from IMS Health Incorporated. Given the role that MEK appears to play in cancer and inflammatory diseases and the increasing preference for oral therapies, the Company believes that AR119, if successfully developed, approved and commercialized, could participate in these growing markets.
Terms of Transaction with Valeant
In consideration for the purchased assets from Valeant, subject to certain conditions, Valeant has the right to receive development-based milestone payments and sales-based royalty payments from the Company. Assuming the successful commercialization of a product incorporating a compound from the 800 Series Program or the 900 Series Program, these milestone payments could total $25 million. For the 100 Series Program, milestone payments could total $17 million, assuming the successful commercialization of a product from that program. For each program, milestones are paid only once regardless of how many compounds are developed or commercialized. In each program, the first milestone payment would be due after the completion of a proof-of-concept clinical study in patients, and more than half of the total milestone payments would be due after regulatory approval. The royalty rates on all products are in the mid-single digits. The Company agreed to further develop the programs with the objective of obtaining marketing approval in the United States, the United Kingdom, France, Spain, Italy and Germany.
Valeant also has the right to exercise a one-time option to repurchase commercialization rights in territories outside the U.S. and Canada for the Company's first NNRTI derived from the acquired intellectual property to advance to Phase 3. If Valeant exercises this option, which it can do following the completion of Phase 2b but prior to the initiation of Phase 3, the Company would be responsible for completing the Phase III studies and for the registration of the product in the U.S. and European Union. Valeant would pay the Company a $10 million option fee, up to $21 million in milestone payments based on regulatory approvals, and a mid-single digit royalty on product sales in the Valeant territories.
Research Services Agreement
The Company also has entered into a research services agreement with Valeant under which it will advance a preclinical program in the field of neuropharmacology on behalf of Valeant. Under the agreement, which has a one- year term with an option to extend, Valeant will pay the Company up to $3.5 million annually to advance the program, and the Company is entitled to development-based milestone payments of up to $1.0 million. Valeant will own all intellectual property under this research program.
The Company is focusing its development efforts on disease areas in which it believes it can reach clinical proof-of-concept relatively quickly. For 2007, the Company hopes to achieve the following clinical milestones:
* Commence Phase 1 clinical trials with AR806 in 2Q 2007
* Commence Phase 1 clinical trials with AR119 in 3Q 2007
* Commence Phase 1 clinical trials with an NNRTI from the 900 Series in 4Q 2007
* Commence a Phase 2a, proof-of-concept study with AR806 before the end of 2007
The Company projects that it will have cash, cash equivalents, and short- term investments of approximately $48.3 million on December 31, 2006, a reduction of $0.7 million from September 30, 2006. For 2007, the Company expects to use approximately $16-20 million in net cash resources to fund operations and expects to end 2007 with approximately $28-32 million in cash, cash equivalents, and short-term investments. The Company currently expects its current cash resources to fund operations through 2008. These projections exclude any potential impact of any future business development activity.
About Ardea Biosciences, Inc.
Ardea Biosciences is focused on the discovery, development and commercialization of novel treatments for HIV, cancer and inflammatory diseases.
Certain statements in this press release are forward-looking statements that involve a number of risks and uncertainties. Such forward-looking statements include statements about the Company's plans for its research and development programs, the potential characteristics of the Company's pharmaceutical candidates, the desired dosing of the Company's drugs, the ability to co-formulate the Company's drugs with other drugs, the Company's ability to progress clinical candidates through development, regulatory approval and commercialization, the Company's ability to select a development candidate from the 900 Series Program, the Company's ability to create a fully-integrated research and development organization, the expected benefits from the Company's new management, the market opportunity for the Company's products and the ability of the Company's products to meet market needs or participate in such markets, the milestones or royalties payable to Valeant, the Company's receipt of funding from Valeant under the research services agreement, the Company's research and development goals for 2007 and the Company's anticipated cash usage and resources.
For such statements, the Company claims the protection of the Private Securities Litigation Reform Act of 1995. Actual events or results may differ materially from the Company's expectations. Factors that could cause actual results to differ materially from the forward-looking statements include, but are not limited to, the Company's planned preclinical studies and clinical trials may not proceed at the time that the Company expects or at all, the results of preclinical studies or clinical trials may be different than expected and may not be predictive of future results, the Company may not be able to create an effective research and development organization, the Company may use cash in its operations at a quicker rate than expected, the Company may be subject to claims that the assets acquired from Valeant were subject to ownership claims or other claims of rights by others, and the Company may become subject to unexpected liabilities resulting from the transaction with Valeant. Additional factors that could cause actual results to differ materially from those stated or implied by the Company's forward-looking statements are disclosed in the Company's filings with the Securities and Exchange Commission.
These forward-looking statements represent the Company's judgment as of the time of this release. The Company disclaims any intent or obligation to update these forward-looking statements, other than as may be required under applicable law.
Source: IntraBiotics Pharmaceuticals
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