GTC Biotherapeutics, Racing Against Time to Prove the Worth of “Pharming”

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from human blood, factor VIIa is one of the most precious products on the planet—the kilogram or so produced each year by Denmark’s Novo Nordisk brings in roughly a billion dollars, Cox said. That makes the protein worth roughly 30,000 times its weight in gold. In 2006, GTC joined forces with France’s LFB Biotechnologies to produce factor VIIa in the milk of transgenic rabbits. If all goes well, said Cox, the companies’ version of the precious protein should enter the clinic “in the latter part of 2009.” Several other blood proteins are prime candidates for pharming, such as coagulation factors IX and VIII, needed to treat hemophilia and other bleeding disorders.

GTC’s most tantalizing prospect, however, is its potential for making relatively low-cost, generic versions of various protein drugs now on the market, particularly monoclonal antibodies, immune molecules used to treat cancer and other diseases. Monoclonals that are good candidates for pharm production currently garner total annual sales of $23 billion, Cox said. Last year GTC raised its profile as a “biogenerics” wannabe by announcing that it and LFB Biotechnologies were working to produce a substitute for Rituxan, a blockbuster for treating blood-cell cancers and rheumatoid arthritis that’s marketed by Genentech and Biogen Idec.

Two things must happen before biogenerics can take off. First, the original medicines’ patents must expire. That’s already starting to happen, but the most important expirations won’t occur until after 2012. In fact, said Cox, “the products we’re particularly focused on are a whole series of monoclonals that will be coming off patent in about five to six years.”

Second, Congress must give the FDA authority to define rules for approving biogeneric drugs. That will entail resolving heated issues, such as proving that generic versions of complicated protein molecules are equivalent to the originals. Last year, the Senate approved language on the biogenerics issue as part of broader FDA legislation, but it was dropped in a later version of the bill. But Cox is optimistic that the regulatory path for biogenerics will soon be defined. It appears, he said, that “the pharmaceutical and biotech industry is actually quite anxious to see the issue settled while President Bush is still in the White House. They feel they can get a deal closer to where they would like it to be” that way. And they may get their wish: along with its recently announced 2009 budget request, the Bush administration said it would push for FDA authority to approve biogenerics, boosting the chance that Congress will soon act on the issue.

Still, the irony of GTC’s position seems more glaring than ever: its future potential is demonstrably growing as its market value is shrinking. That’s often the case for early-stage biotechs, and Cox argued that the “ATryn news flow” in coming months and other signs of progress should pull GTC’s stock out of its current malaise. Stock sales “are really only dilutive if a company isn’t creating value with the cash it raises,” he added. “And we feel that we’re creating tremendous value.” Further, getting ATryn approved “was an exhausting and challenging process that developed great backbone in the company. That’s going to stand us in very good stead going forward. We just have to stick with it.”

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