Expanding the Spectrum
February 2011
by Kimberley Sirk  |  Email the author

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IRVINE, Calif.—Biotech company Spectrum Pharmaceuticals Inc. began 2011 with a bang, announcing that it seeks to make headway into the biosimilars space by signing an agreeement with Viropro to develop a copycat version of the monoclonal antibody drug rituximab. The new partnership seeks to enter the space dominated by Genentech/Roche's Rituxan.

Rituximab is currently used in the treatment of non-Hodgkin's lymphoma, chronic lymphocytic leukemia and rheumatoid arthritis.

A biosimiliar version of rituximab is the catalyst for a global race to build partnerships to bring a new version to market.

The announcement set off a flurry of online chatter in the business sector, as Spectrum and Viropro became the subject of several stories speculating on what the deal could mean to either or both companies. In addition, Viropro issued a statement to the public and investors Jan. 21, indicating that the company was undergoing some internal reorganization, sales of company shares and restatement of financial data.

Spectrum and Viropro have competition in the race to the rituximab finish line. Also in early January, Novartis announced that through its generics unit Sandoz, clinical Phase II trials for its own version of Roche's multibillion-dollar drug Rituxan had commenced.

Known as MabThera in Europe, the therapy is used to treat non-Hodgkin's lymphoma and rheumatoid arthritis. The Sandoz trials are with patients with rheumatoid arthritis.

In 2009, sales of rituximab were approximately $5.6 billion.

"They had the technology we were interested in, so we acquired the worldwide rights," says Paul Arndt, senior manager of investor relations for Spectrum. "We were looking at others to pursue biosimilars with, and Viropro was the best match. The due diligence in this area is quite extensive. But we feel we've found the right company to form a deal with."

Biosimilars, or follow-on biologics, are terms used to describe officially approved subsequent versions of innovator biopharmaceutical products made by a different drug company after an original patent has expired. The subject of controversy for some time, the compounds are regulated more effectively in Europe; the United States began to inch toward formal regulation of biosimilars in last year's healthcare reform legislation. That law seeks to set up a regulatory framework for the drugs, as scientist argue that a simple change within the molecular framework of a chemical can alter the intended effect in some patients.

A number of biosimilar products are already in the market in Europe.

Following enactment of the Biologics Price Competition and Innovation Act of 2009, an abbreviated approval pathway for biosimilars had been created in United States.

Biologics are also very sensitive to manufacturing process changes, including the choice of the cell type, production process, purification process and formulation of the biologic into a drug. In view of the complexity and sensitivity of the biologics to manufacturing processes, no two biotech medicines can be exactly the same, hence the term "biosimilar." 

Company officials at Spectrum were tight-lipped about the deal, and how it came to be, and Viropro officials did not reply to several requests for comment by press time, but financial websites lit up early this year with speculation about Spectrum.

Numerous websites, such as the Motley Fool and thestreet.com have identified Spectrum as a company to watch, and a bargain buy in the biotech sector. The small company, the sites say, could either score big or take a huge hit contingent on development of this new biologic.

"We are excited at the opportunity to develop our own proprietary biosimilar formulation of rituximab in anticipation of patent expirations for rituximab over the coming years," said Dr. Rajesh C. Shrotriya, chairman, CEO and president of Spectrum Pharmaceuticals, in a prepared statement.
A statement issued by Viropro states that the agreement calls for payment for milestones over an expected 36-month timespan, and also calls for the payment of royalties from ensuing sales.

Viropro President and CEO Dr. Rajiv Datar also commented, "We are extremely pleased to announce the signing of this agreement; it reaffirms the quality of our research and proprietary technology. It is an important breakthrough for us in the North American market. Spectrum is a fast-growing and well-established biopharmaceutical company. Over the past few months, Spectrum has thoroughly examined and evaluated our technology and offer, and the ensuing agreement is very satisfying."

This is the second client to contract for a monoclonal antibody-based therapeutic drug with Viropro. In 2007, an agreement was reached with Intas Biopharmaceuticals Ltd. of Ahmedabad, India.

Viropro says on its website that it is a public company incorporated under the laws of the state of Nevada, but also identifies a presence in Montreal, Canada. Viropro conducts its operations through its subsidiaries Viropro International Inc. and Biologics Process Development Inc., located in Poway, Calif. The company offers contractual research and manufacturing services to the biopharmaceutical industry through patented cell lines and process development that are then out-licensed to various international partners who produce and distribute the final product. The company states specifically that it is currently seeking partnerships for its biosimilar cell lines and manufacturing processes.
 
Spectrum Pharmaceuticals is a biotechnology company with integrated commercial and drug development operations, with a primary focus in oncology. The company's strategy is comprised of acquiring, developing and commercializing a broad and diverse pipeline of late-stage clinical and commercial products. The company markets two oncology drugs, Fusilev and Zevalin, and has two drugs, apaziquone and belinostat, in late-stage development along with a diversified pipeline of novel drug candidates.
 
Code: E021120

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