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March 1, 2004
Volume 82, Number 09
CENEAR 82 09 pp. 37-42
ISSN 0009-2347

Technology platforms by themselves are no longer enough--now companies need products to generate value


Since its beginnings in the late 1960s, the drug delivery field has focused on creating new forms of established drugs. Drug delivery has been seen as a method of "life-cycle management" to extend product franchises by offering improved versions of drugs as patents are getting ready to expire. In other cases, drug delivery companies have created their own versions of drugs that are off patent.

STARBURST Photomicrograph of crystals of celecoxib sodium ("dots") converting to needlelike crystals of celecoxib ("star") during exposure to an aqueous solution. Careful formulation strategies can avoid such problems and improve the bioavailability of the drug. COURTESY OF TRANSFORM PHARMACEUTICALS
Now drug delivery companies are starting to position their technologies earlier in the drug development timeline. Alza Corp.'s efforts are a prime example. Speaking last December in Hawaii at the U.S.-Japan Symposium on Drug Delivery Systems, Alza President Howard B. Rosen described how his company, located in Mountain View, Calif., is becoming involved with the pharmaceutical development process as early as the discovery phase.

"We now have access to new molecular entities to which we can apply novel drug delivery technologies," Rosen said. "This is a relatively new area of focus for us and the industry as a whole, as most drug delivery products that have been brought to market have been based on off-patent compounds or life-cycle management concepts."

Alza, part of Johnson & Johnson since 2001, now plays a role in various stages of the drug life cycle, Rosen said. Although still involved in life-cycle management, it is now also involved with developing methods to deliver new chemical entities and biopharmaceutical products. Alza scientists are working with discovery chemists to do what Rosen called "enabling activities." For example, they might take a compound that has a short half-life in the body and manipulate the pharmacokinetic profile using drug delivery. Such drug delivery activities can help drugs that are notoriously difficult to deliver, such as poorly water-soluble compounds, stay in the pipeline.

"By applying drug delivery earlier in the development process, there is a potential to improve productivity as well as product outcomes and create truly best-in-class products," Rosen said. "Working back to Phase I to III clinical trials, drug delivery is looked at to fill the space between early and late clinical development."

One consequence of being involved earlier in the process is that smaller quantities of the drug substance are available. When drug delivery scientists work with marketed products to devise new delivery methods, they have the luxury of working with kilogram quantities. At the early discovery stage, they often have access to only milligrams. Therefore, they must come up with new methods of testing delivery options.

"If the value is not clear, the price will always be too high. If the value is clear, the price won't really matter."

IN THE PAST, drug delivery companies have positioned themselves as technology companies, but now it's no longer enough for drug delivery companies to rely solely on their technology platforms. They need tangible products. At the Drug Delivery Partnerships meeting, held in Los Angeles in late January, "products" and "value" were major themes.

"It's all about products," said financial analyst David M. Steinberg, managing director of equity research for specialty pharmaceuticals and drug delivery at Deutsche Bank Securities in San Francisco. "That's where the value comes in."

Because products are so important in imparting value to the industry and investors, Steinberg suggested that the "right" business model for drug delivery companies includes having multiple technology platforms and multiple product opportunities, representing "more shots on goal." With only one technology, a company's prospects are limited without a blockbuster drug, Steinberg said. He pointed out that as the health care system tries to contain costs, "me too" products will "fall by the wayside" and "differentiated, high-value drug delivery products will win."

Roger Longman, managing partner at Windhover Information in Norwalk, Conn., spoke in Los Angeles about deal making in the drug delivery industry. He said that big pharma is increasingly interested in shortcuts or "jump-starts" to discovery. When a pharmaceutical company enters a deal with a drug delivery or specialty pharmaceutical company, it is usually paying for the recognition of established value rather than the discovery of a new compound. Longman said the average up-front value of deals has increased dramatically because this recognition of value is increasing.

Nevertheless, Longman said that pharmaceutical companies still often fail to see the value of products, which he ascribed to their "inability to see around corners." He cited the example of the Eli Lilly/Icos product Cialis, one of the most recent entries in the erectile dysfunction market. The compound started out as a project between Glaxo and Icos. However, because the inhibitors had no clear value in cardiovascular disease or inflammation, which was what Glaxo was interested in, Glaxo gave the product to Icos, who then teamed up with Lilly.

The growth in drug delivery deals needs to be seen in the context of jump-starting discovery, Longman said. The big drug delivery deals are still small compared to deals with biotech companies. That's because the drug delivery deals are seen as bringing lower value to the company, he noted.

One of the problems has been the "genericization" of drug delivery, Longman said, citing controlled release and patch technologies as examples. "Without a significantly novel system, it's difficult to do more than a modest up-front deal," he said.

Drug delivery companies are being pushed to create products, Longman observed, because their partners are looking for proof that a technology will pan out. "The feasibility period doesn't end until the drug delivery partner can demonstrate the finished product," he said.

The opportunities for small drug delivery companies will increase as the large pharmaceutical companies continue to consolidate, Steinberg said. He pointed out that in mature industries such as the petroleum and automotive industries, the top 10 companies account for 80 to 95% of the industry's total sales. In the pharmaceutical industry, the top companies account for only 57%, leaving a significant portion of the pie for companies not in that upper tier.

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BREATHE DEEP Nektar Therapeutics is developing pulmonary delivery strategies for a number of drugs, including insulin. The micrograph shows insulin particles that are used in the device. COURTESY OF NEKTAR THERAPEUTICS

IT'S IMPORTANT TO determine the value of a product before committing resources to its development, Eugene M. (Mick) Kolassa told the audience in California. The perspective of the different parties involved plays a large role in determining that value.

Kolassa, managing partner at Medical Marketing Economics and adjunct professor at the University of Mississippi, Oxford, pointed out that manufacturers, physicians, patients, and insurers all view value differently. For manufacturers, value is found in a number of areas. Technology can provide a barrier to other companies and thus help a company stake out an exclusive area or extend the life of a patent. Another source of value is in new disease indications. New technology can open up additional pricing options and expand a product line. Finally, value can come from improved patient compliance. Patients and physicians both find value in reduced side effects and simplified dosing, which improve the quality of life and ease of use. Payers are concerned with improved compliance and decreased health care costs.

A number of key questions help determine value, Kolassa said. What does the disorder cost society? What is the potential to reduce costs? What information will be required to demonstrate savings? What potential is there to increase costs but improve patient outcomes? The answers to these questions can establish whether a product is worth developing.

Kolassa offered a simple rule of pricing and value: "If the value is not clear, the price will always be too high," he said. Likewise, "if the value is clear, the price won't really matter." He pointed out that "a delivery system is only as good as the value it brings to the market in the minds of the customers."

The incremental value of a new product is determined by the unmet needs and the urgency of the condition it treats. For example, a new medication to treat ear infection would be much less valuable than one to treat stroke, which is a critical condition with few medication options.

Steinberg believes there are a number of important technologies for the future of drug delivery. He said that oral controlled release has been a "big winner" for the drug delivery industry. Steinberg disagrees with the widely held notion that oral delivery has completely become a commodity item.

Pulmonary delivery is an area that is generating broad interest and has the potential to provide successful products. One product that Steinberg believes has the potential to generate more than $1 billion annually is Exubera, an inhaled insulin being developed as a collaboration between Nektar Therapeutics (formerly Inhale Therapeutic Systems) and Pfizer.

John S. Patton, founder and chief scientific officer of Nektar, believes that inhaled insulin will be a "breakthrough product." Patton told the audience at the Hawaii meeting that the main problem with Exubera thus far has been fear. A few cases of pulmonary fibrosis, a disease characterized by scar tissue in the lungs, have been observed, but they appear to be caused by preexisting conditions rather than the pulmonary delivery. He said that 50 patients have already been taking Exubera for more than six years, and their blood glucose levels are as well controlled as by injection. In fact, he told C&EN, the precision of dosing is better with the inhaled insulin than with injection.

The Phase III study for Exubera has been completed. However, it has not yet been determined when the New Drug Application will be filed with the U.S. Food & Drug Administration. Several other companies are also working on inhaled insulin, but Patton thinks that Nektar has a significant head start.

HIJACKER Transceptor technology for delivering drugs, from Syntonix Pharmaceuticals, takes advantage of the FcRn receptor, which is responsible for the transport of immunoglobulins across epithelial cells. A fusion molecule consisting of a drug and part of an immunoglobulin enters the cell via pinocytosis (shown bottom left). It moves across the cell and enters the bloodstream. The drug is absorbed by endothelial cells lining the blood vessels and recycled back into the bloodstream, extending the circulating lifetime of the drug (bottom right). ILLUSTRATION BY GRAHAM JOHNSON/FIVTH.COM

INSULIN is just the "tip of the iceberg" for delivering drugs through the lung, according to Patton. Most people think of pulmonary delivery as a topical method for respiratory illnesses such as asthma, but all asthma drugs are absorbed systemically, he said. Similarly, other drugs could be delivered through the lung, which offers rapid onset of the medication and avoids first-pass metabolism in the liver. Patton believes that pulmonary delivery is an excellent option for vaccines, especially against pathogens that are introduced through the lungs.

Nektar is working on other applications of pulmonary delivery as well. The company is collaborating with Chiron to develop inhalation antibiotics for treating pulmonary diseases. Speaking at the California meeting, Peter Challoner, head of inhaled drug delivery at Chiron, said that delivering antibiotics by inhalation would minimize systemic exposure to the drug and immediately achieve a high drug concentration at the infection site.

Other companies are also working on methods for pulmonary delivery. At the California meeting, Alan J. Bitonti, vice president for research at Syntonix Pharmaceuticals in Waltham, Mass., described his company's Transceptor technology, which delivers drugs using an antibody receptor that is usually responsible for transporting immunoglobulins across epithelial cells. The drugs--including proteins, peptides, small molecules, and antisense oligonucleotides--are linked to a fragment of an immunoglobulin G, creating a fusion molecule. Because the specific receptor, known as FcRn, is primarily expressed in the upper respiratory tract, patients can inhale drugs by breathing normally. Most pulmonary delivery approaches require the drug to reach the deep lung and thus compel patients to alter their normal breathing patterns.

The fusion molecule crosses the cell membrane through a process called pinocytosis, in which cells take up fluids in tiny vesicles . Through the process of endothelial recycling, the plasma membrane captures the drug by forming a vesicle around it and then releasing the drug back into circulation, which increases the time the drug circulates in the body.

Syntonix is initially focusing on improving already successful protein drugs. The firm's lead drug candidate is an erythropoietin fusion molecule. Compared with the Amgen product Epogen, the erythropoietin fusion molecule is longer lasting, and pulmonary administration is competitive with subcutaneous injection, Bitonti said.

Brooks Adams, director of business development at Chrysalis Technologies in Richmond, Va., described his company's Aria pulmonary delivery technology, which is based on a soft mist aerosol. The aerosol is generated by a thermomechanical process in a heated stainless steel capillary without using propellants. The drug remains in the capillary for only a short time, minimizing the opportunity for it to be thermally degraded. The excipient system is vaporized and then cools, forming a low-velocity aerosol stream. The system can be configured to create a variety of particle sizes, from 1 to 5 µm and even nanoparticles smaller than 100 nm, making the system appropriate for both local and systemic applications.

FINDING WAYS to expand the applicability of transdermal drug delivery was another common topic at the recent meetings. In the most familiar transdermal technologies, such as nicotine patches, drugs passively diffuse through the skin. Companies are now working on ways to actively drive drugs through the skin.

GETTING MISTY A soft mist aerosol is generated thermomechanically in the functioning prototype of the Aria pulmonary delivery system (shown) by Chrysalis Technologies. CHRYSALIS TECHNOLOGIES PHOTO
Rosen described a product for acute pain management that incorporates Alza's E-Trans technology to deliver the medication fentanyl through the skin using low-level electrical current. Patients control when they receive the drug, but they can't receive a dose more frequently than once every 10 minutes. The device is preprogrammed to administer up to six doses an hour and 80 doses per day. Each system is designed to become inoperative after 80 doses or 24 hours after the first dose has been administered, whichever comes first.

Judith Kornfield, vice president of business development at TransPharma Medical in Lod, Israel, described her company's technology for crossing the barrier presented by the stratum corneum, the outermost layer of skin. An array of microelectrodes is placed on the skin, and a radio-frequency current is passed through the electrodes. The process creates pores deep enough to cross the stratum corneum but not to reach nerves or blood vessels. A patch containing the drug of interest is then placed over the area of skin, and the drug enters the body via passive diffusion. The technology can be used with a broad range of molecules, from hydrophilic or hydrophobic small molecules to proteins.

Another transdermal technology was described by James Garrison, vice president for business development at Vyteris, located in Fair Lawn, N.J. Founded in 2000, Vyteris is a drug delivery company based on technology that was acquired from Becton Dickinson.

Vyteris' technology is based on iontophoresis, in which an electric current is used to actively drive the drug through the skin. By adjusting the amount of current passed through the device, one can precisely control the rate and amount of drug that is administered, Garrison said. By separating the patch and the controller, the company hopes to lower the cost and ease the regulatory process, he said.

Vyteris attempts to identify established drugs that can be developed to Phase III clinical trials with little risk. The company's lead product is a transdermal lidocaine. Vyteris believes that the product has the potential to be a $400 million seller, Garrison said, and it hopes to get the product on the market this year. Other near-term candidates at Vyteris are drugs for deep-vein thrombosis and migraine.

Steve Wick, a senior technical manager in the 3M Drug Delivery Systems division, described his company's transdermal technology. To disrupt the barrier properties of the stratum corneum, 3M uses arrays of plastic microneedles. The needles are 40 µm across at the base and 100 to 400 µm long. When the array is used as a pretreatment method, the needles are applied and then removed. Then a patch is applied to the treated area. When hollow microneedles are used, the needles are left in place and the channels that they create remain open. Hollow needles can be used to deliver liquids.

3M is investigating the microneedles as a delivery method for vaccines. The needles can be coated with a protein or vaccine adjuvant, left on the skin for about an hour, and then removed. The vaccine is then deposited on the skin. Company researchers have done in vivo tests in animals of the immunization efficiency, and rabbit studies show minimal skin irritation. In initial human tests, people perceive little pain with the microneedles. The company expects to move into clinical trials later this year, Wick said.

Although drug delivery technology is often identified with devicelike applications, the drug molecule itself can be part of both the drug delivery problem and solution. For example, many drug compounds can crystallize in a variety of forms known as polymorphs. The wrong polymorph can be at best ineffective and at worst dangerous.

TransForm Pharmaceuticals, located in Lexington, Mass., focuses on using high-throughput methods to find the optimal physical form of a drug to be used. "Form needs to be coupled with formulation," Colin R. Gardner, chief scientific officer at TransForm, said at the Hawaii meeting. "Developability is the key factor in finding a new drug. Potency is easy to come by. The physical properties are critical."

Gardner pointed out that once a drug is in the body, the body doesn't know or care how it got there. "It gets in the bloodstream, and it's going to be in the form that's in equilibrium with blood," he told C&EN. But getting the drug into the body in the first place depends on the physical form of the drug. One form may work best for getting the drug through the gastrointestinal tract, for example, and another form may be better for cutaneous administration. Regardless of how the drug gets into the plasma or the circulation, it ends up in the same form. "It's almost like a Trojan horse," Gardner remarked. "Once you're in, it doesn't matter how you got in."

TransForm's core solid-state technology is known as CrystalMax. It is used to perform high-throughput crystallization experiments using combinatorial mixtures of solvents and additives to find alternative solid forms of drugs, such as polymorphs, salts, hydrates, and cocrystals. The solids are analyzed using Raman spectroscopy and X-ray diffraction, and they are grouped according to similarities in the patterns. Despite TransForm's reliance on high-throughput methods, Gardner emphasized that high-throughput technologies are most successful when coupled with good science and scientific intuition.

THROUGH SKIN A product using Alza's E-Trans transdermal delivery system to deliver the pain medication fentanyl awaits FDA approval. COURTESY OF ALZA
GARDNER PRESENTED celecoxib (the cyclooxygenase-2 inhibitor found in Celebrex) as a case study of how the right form of the drug can improve the performance. Although celecoxib has the most sales of the COX-2 inhibitors, it's poorly water soluble and has some performance issues. It's only moderately bioavailable, has slow onset, and has a nonlinear pharmacokinetic profile, due largely to poor aqueous solubility. Using a novel form of celecoxib in a customized formulation, TransForm was able to increase the bioavailability of the drug from 40% to 95%, with a faster onset, and to achieve a linear pharmacokinetic profile in a dog model.

TransForm has used its technology to identify the various forms of sertraline, the active ingredient in the antidepressant Zoloft, which is already known to be highly polymorphic with 18 known solid forms. In more than 6,200 experiments, TransForm scientists identified 36 forms of sertraline. They were also able to identify a variety of acceptable counterions. They found 18 crystalline salt forms, including seven that were previously unknown. Three of the salt forms were significantly less polymorphic than the HCl salt in the marketed product.

Gardner also described TransForm's work in high-throughput formulation discovery. In one set of experiments, an active ingredient that Gardner did not identify was tested with 18 different excipients to find which combination gave the best performance in terms of optimizing multiple parameters of a formulation. The excipients were tested individually and two or three at a time in a total of more than 4,000 experiments. The researchers found that ternary excipient combinations gave the best results. They also found that the rank of individual excipients did not accurately predict their performance in mixtures.

A collaboration with Alza is one of TransForm's "spectacular successes," Gardner told C&EN. "They've changed the whole way transdermal delivery is done at an early stage," he said.

Rosen described the collaboration as the development of a screening platform to find optimal formulations for transdermal drug delivery. "Through the twofold innovation--platform and formulations--we can capture the maximum value from our drug portfolios," Rosen said.

Capturing that value is what drug delivery companies need to do. Moving forward, the challenge for drug delivery companies is to become more than just platform companies. These companies need to turn their attention to developing actual products that can bring value to themselves and society. Companies are rising to the challenge, and the transformation has already started.


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