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Archive → April, 2010

Friday round-up

Sorry for the lack of posting this week, folks–on my end, I was simply swamped after returning from our advisory board meeting in DC. Hopefully I’ll get back in the swing of things next week. In the meantime, here’s this week’s collection of chemical health & safety news stories:

  • Offshore oil safety awards luncheon postponed
  • Radioactive material in scrapyard in India kills 1 (dismantling chemistry lab equipment)
  • Fire damages Wockhardt’s unit at Ankleshwar, India
  • Man, 21, seriously injured in Taylor, Mich., garage blast (homemade fireworks)
  • Fiery explosion of gas, chemical van causes chaos on Kwinana Freeway, Australia (possibly hydrochloric acid)
  • Univ. of Toronto building reopened after hazardous chemical fears (anhydrous acid)
  • Fumes sicken 8 at Franklin Park, Ill., packaging plant (cleaning solution)
  • Eight students, teachers sickened by fumes at North Plainfield, N.J., elementary school (drain cleaner)
  • Hazmat team sent to Michigan high school (yellow phosphorous)
  • Hazmat crews battle New Haven, Ind., chemical spill (chlorine)
  • Tornado Hits Louisiana Chemical Plant, Shipyard, Houses
  • C&EN Chemicals regulation (Toxic Substances Control Act reform)
  • C&EN Dispersing nanotubes renders them nontoxic

See You at BIO!

And we’re off to the Biotechnology Industry Organization’s annual meeting, which is being held in Chicago this year. I’ve been trying to remember how many of these I’ve been to now–eight? nine? Either way, BIO is the meeting everyone loves to hate. Some complain its become irrelevant, others that it has gotten too big and unfocused, but I can guarantee that pretty much every biotech and big pharma out there will still have at least one person (or dozens) repping in Chicago next week. There will be plenty to see and do. Me, I’m just happy if I can find a coffee cart without a 15-minute line and survive the many sprints across McCormick Place in my desperate hope of getting to meetings on time.

Check back daily for our coverage from the conference, including updates on start-ups we’ve covered in the pages of C&EN and the overall sense of the “state-of-the-industry” among attendees. What you won’t see is coverage of the much-hyped Clinton/Bush keynote luncheon on Tuesday, as BIO has barred press from entering. We’ll see who manages to sneak in.

In the meantime, see you in Chicago!

Provenge Becomes First Cancer Immunotherapy Approved

Can you hear that? It’s the sound of champagne corks popping across Seattle today. Dendreon has at long last won FDA approval for its prostate cancer vaccine Provenge.

Though not exactly a surprise, the regulatory nod it is still big news for Dendreon, which has struggled for years to bring the immunotherapy to market. In the broader scientific terms, Provenge will be the first therapeutic vaccine approved for cancer.

On a conference call this afternoon, Dendreon’s president and CEO Mitchell Gold called it “the dawn of an entirely new era of medicine,” one in which a patient’s own immune system can be wrangled to combat cancer.

Provenge works by prompting a patient’s immune system to wage its own battle against the disease. A blood sample is taken from a patient in order to isolate dendritic cells, which deliver antigens to T-cells and B-cells, the lymphocytes that control the immune response. Those dendritic cells are then cultured with the general component, prostatic acid phosphatase, a recombinant protein found in 95% of prostate cancers. The dendritic cells, now loaded with the antigen, are then injected back into the patient to trigger a reaction from the immune system. Patients receive three doses of the vaccine over the course of a month.

The vaccine has had its ups and downs. When we wrote a lengthy piece on cancer vaccines back in 2006, the field seemed on the cusp of a breakthrough with Provenge. Then, just a year later, FDA said it would need more data on the therapy. Patients were outraged, some claiming foul play by members of the agency’s advisory panel. It wasn’t uncommon to see small groups handing out pamphlets or picketing at annual meetings of the American Society of Clincial Oncology. Dendreon preserved, running another trial and finally reaching the finish line.

So now that the drug is finally available, down to the practicalities. First, how much will it cost? Speculation on this point had been rampant. Xconomy recently broke down different analyst estimates for price-per-patient, which ranged from $40,000 all the way up to $100,000. Today it became clear the biotech was aiming for the higher end of that range: Dendreon will charge $31,000 per infusion, and a full course of treatment typically calls for three infusions. Or, in the awkward—some might say grim–assessment by the company’s COO Hans Bishop, that’s $23,000 per month of life extension for these patients.

Second, how many people will be able to get it? Dendreon said current capacity can accommodate 2,000 patients its first 12 months on the market. The biotech is launching the drug out of its N.J.-based facility, which it started building back in 2006 and is currently operating at 25% capacity, and is meanwhile finishing up construction and licensing of two more sites. Within a year, all three plants are expected to be up and running at full steam. Physicians are now being trained in the production process (the drug is, after all, based on one’s own cells), and Bishop says he expects the first patient to begin treatment within the week.

Last, what other companies might be getting in on the Provenge boom? For right now, no one. Dendreon, which has yet to license the drug in Europe,  is “putting partnership discussions aside for now,” Bishop said. He noted that the European market is one-to-two times the size of the U.S. market, and the future opportunity for partnership there could be great.

The idea of curing cancer by mustering the immune power within is an exciting one (not to mention one that has been around for awhile). Gold’s exuberance at this first approval is well deserved, but it’s also important to recognize the current limitations of the approach. A lot of science has happened since Dendreon started developing Provenge, and with this first approval I’d be keeping an eye on other technologies that might prove more potent (including that going on within Dendreon’s own labs).

Beyond siRNA: Alnylam’s Other Biotherapeutics Ambitions

Alnylam gave a first peek today inside its new biotherapeutics manufacturing business, launched in November. So far, it looks kind of intriguing. Though best known for as a leader in the race to turn siRNA into viable therapeutics, the company has embarked on a bit of a side project: using siRNA to improve the yield of biologics manufacturing process.

As you’ve probably read, therapeutic proteins such as monoclonal antibodies ain’t cheap. And though it’s safe to assume the mark-up on biologic drugs like Genentech’s Avastin is high, they also are quite expensive to produce. One major issue has been the low yield of those infamous Chinese hamster ovary cells churning out some of our antibody therapeutics—they don’t live long and not everyone in the pot likes to make drugs.

Alnylam is hoping to fix that yield problem. As Stuart Pollard, Alnylam’s vice president of scientific and business strategy explained in a chat today, the goal is to move beyond the crude modifications to temperature, pH, and nutrient content that companies make to improve biologics manufacturing yields. Alnylam’s idea was that siRNAs could be used to silence some of the proteins that contribute to cell death.

Today’s data is an early look at how effective siRNA might be at improving yields. The company looked at two metabolic pathways that impact the viability of cells, and, though it was done at a small scale, did show that its siRNA was able to nearly double the number of cells that were active. “We see almost doubling of the viable integral cell tanks over that period of 15 days where we’re applying siRNAs,” Pollard said.

Yes, you might say, but many others are looking at how to improve yield through new technologies. Merck didn’t pay $400 million for GlycoFi in 2006 for nothing: the biotech’s engineered yeast that can make consistent, complex proteins laid the groundwork for Merck’s biosimilars strategy. So why would using siRNA in manufacturing be an interesting proposition? Aside from improving yield, siRNA could be simply added to existing master cell lines. In other words, this is a process improvement that could be applied to drugs already on the market, those in development, and anything on the horizon.

Still, these results were only at the one-liter scale, and Alnylam has yet to come out with data showing it has successful made a protein out of the process. Pollard says scale-up is underway, and more data will be forthcoming. But Pollard seems confident of its potential: “When will this application be used commercially? We think it could be pretty near term.”

Any route that can make manufacturing of biotherapeutics more affordable will surely be in demand, particularly as big pharma pushes into making generic biologics (or, if you prefer, “biosimilars”). Just today, the WSJ reported that Pfizer had revealed its first three biologics that aim to outdo existing drugs, two improving upon Genentech/Biogen Idec’s Rituxan and another improving the potency of Amgen’s Embrel.

LyondellBasell Leaving Bankruptcy Behind

A Manhattan bankruptcy court is allowing LyondellBasell to emerge from Chapter 11 on Friday.

The company is emerging with $7.2 billion in debt, $2 billion in cash, and 2009 sales of $30.8 billion. This is a far cry from the $24 billion in debt that it had when it declared bankruptcy back in January 2009.

LyondellBasell is supposed to file a Form 10—-as in 10-K’s, 10-Q’s and the like–with the SEC soon. From that document, we will see what kind of stakes Access Industries, Apollo Management, and Ares Management, as well as other creditors—ABN AMRO and so on–will get in the company.

Also worth noting, Access’s original equity was wiped out. It ends up with an equity stake because it had purchased bonds and got in line in bankruptcy court like everybody else. This sheds some light on why ownership of the original equity of the company was put into a joint venture with ProChemie Holding last year. For some convoluted legal reason, perhaps Access needed to form the JV to buy the bonds.

We also might learn a little more about LyondellBasell’s plans to go public again on the NYSE.

It was one of the largest bankruptcies in recent memory. (Though, I think of LyondellBasell as more of a schooner than a sloop. And, poor Washington Mutual! It sunk before it finished loading cargo, apparently. Click on the link to get the remark.)

Though, for its size, LyondellBasell is reasonably intact. There weren’t any fire sales or liquidations, and what is emerging is a company much the same as the one that filed for chapter 11. There is certainly an “Under New Management” sign on the door of its Rotterdam, headquarters, though.

The bankruptcy had a couple of twists and turns. Creditors sued because they thought Access contributed to the bankruptcy by paying too much for Lyondell. (I recall an earlier shareholder lawsuit against Lyondell’s board stating that they didn’t do enough to hold out for more. There’s no satisfying some shareholders. I suspect that when Access’s $48-per-share offer came in, the reaction in the Lyondell boardroom was probably something like the locker room of a ball club that has just clinched the World Series.)

The LyondellBasell bankruptcy also saw a series of dollar short/day late bids from Reliance Industries. Only a bus full of mall walkers browses without buying more than that Indian conglomerate does.

A Chemistry-Themed Book Launch

Credit: Jacqueline Jaeger Houtman

Credit: Jacqueline Jaeger Houtman

Credit: Jacqueline Jaeger Houtman

Credit: Jacqueline Jaeger Houtman

During the book launching party for Jacqueline Jaeger Houtman children’s book, “The Reinvention of Edison Thomas,” Houtman provided guests with cupcakes in the form of a periodic table.  But she took the nerdiness a few steps further than simply labeling cupcakes with elements. The sweets were flavored according to their chemical group; noble gases were lemon, lanthanides were chocolate mint, halogens were chocolate peanut butter, etc.

Houtman also made sure guests earned those extra calories, and required them to learn a little something about their element before chowing down.  For more information on Houtman’s book, visit her website.

Codexis – An example of “integrated innovation”?

I’m at the Lux Research Executive Summit today. You can follow my twitter stream from the conference.

Lux Research Director Michael Holman (who also happens to be a PhD chemist) just gave a presentation discussing the shortcomings of the venture capital model for bringing innovations in physical sciences to market (especially in materials science, energy, and the environment). VC investments worked well for tech companies like Google, which raised a mere $25 million of venture funds before going public.

Another problem is that scientists with lab-discovered innovations do not always pick the right markets and applications for their discoveries. Holman suggests that physical sciences start-ups would be better off partnering in their early stages with the venture and partnership arms of larger corporations.

Corporate partners have a clear understanding about where new technologies are most needed, and they know a great deal about the potential market sizes. Still, most early-stage start-ups are very concerned about being taken over or co-opted by corporations that might not care about the smaller firm’s health and possible future. Holman suggests that agreements that include particular financial incentives can help smooth the way.

One company that Holman says successfully partnered with corporate ventures is Codexis, a biocatalysis firm targeting renewable fuels, pharmaceuticals and chemicals. Codexis went public last week and raised $78 million, a strong result in a fragile economy. (Though Codexis originally hoped to raise a cool $100 million). Though the firm did raise some venture money, it partnered early and widely with firms like Chevron, GE, Pfizer, and Shell. Holman says firms like Codexis benefit from the insights of corporate partners and can even speed up their time to market for their products or to exits like IPOs.

Leaping into China, Charles River Buys WuXi

In a deal that seems to be taking everybody by surprise, Charles River Laboratories is shelling out $1.6 billion for WuXi PharmaTech, a Shanghai-based contract research organization. See here for the nitty-gritty details, but basically the deal turns Charles River, which previously focused on animal models and clinical services, into a one-stop shop–or in the PR speak of the CRO world, “a fully integrated research and drug development services” firm. That means a customer can walk in with a drug target and walk out many months later with a drug candidate that has been tested through Phase I.

WuXi is the leading CRO in China, with over 3,200 scientists with advanced degrees (a whopping 2,000 of those are chemists). The company has quickly blossomed in the last five years, with sales growing from $20 million in 2004, to an anticipated $310-320 million this year. WuXi continued to add to its headcount last year, “at a time when the CRO industry declined as a confluence of factors from economic recession to biopharma M&A and pipeline rationalization hurt the industry,” Deutsche Bank analyst Ross Mulken said in a note to investors today.

Much of that success can be attributed to the drive of Ge Li, WuXi’s founder and CEO, who under the new regime will become president of global discovery and China services. Li, an organic chemist with a doctorate from Columbia University, was one of the founding scientists of Pharmacopeia, the N.J.-based drug discovery firm that was bought by Ligand Pharmaceuticals in late 2008. Li returned to China to form WuXi in 2000.

Though WuXi has a strong chemistry base, the company has also been building up a biology capacity in China since 2008, which some think is the real motive behind Charles River’s bid. The company recently built what it says is the largest toxicology lab in Suzhou, about 30 minutes outside of Shanghai, essentially enabling it, on a small scale, to do just the kind of integrated “molecules to man” work that Charles Rivers is hoping to perform.  Wuxi recently sealed a toxicology and preclinical services contract with Johnson & Johnson, which is going to train WuXi scientists in the art of good laboratory practices. J&J, by the way, had already hired WuXi to do discovery chemistry work (as has AstraZeneca, Merck, Eli Lilly…).

So does that make WuXi a good fit with Charles River? The acquisition certainly feels like a bold (or at least intriguing) move, though it has not been an entirely well received addition to its portfolio: Charles River’s stock was down nearly 16% to close at $33.55 today. Why the negative reaction to the deal? Although most analysts seem to think the move makes sense in the long-term—after all, big pharma has been swiftly shifting more and more work to China—many are worried about the ease with which the two companies can integrate. Further, there is an increasing sense that it won’t be long before China can no longer compete on cost. Will WuXi still seem like a great asset then? Feel free to air your thoughts in the comments.