BioMS Gets FDA Approval For Pivotal Trial Of MS Drug

BioMS Medical Corp. (MS.T) has received approval from the U.S. Food and Drug Administration to start a pivotal trial of its lead drug, MBP8298, a potential treatment for patients with secondary progressive multiple sclerosis, the company confirmed.

The Phase III trial will enroll about 510 patients and take about two years, said Kevin Giese, BioMS Medical's president and chief executive.

The company has already begun a Phase III trial of the drug in Canada and Europe, which will enroll about 550 patients.

Multiple sclerosis is a disease of the central nervous system, marked by such things as paralysis, blindness and cognitive impairment.

Shares of BioMS are halted in Toronto Friday. The stock last traded at C$3.48.

Kevin Giese, president and chief executive of BioMS Medical Corp. (MS.T), said the company submitted an application for the trial with the U.S. Food and Drug Administration last month, and the agency gave its consent relatively quickly.

That means BioMS will soon have two Phase III trials in secondary progressive multiple sclerosis, or MS.

He hopes to commence the U.S. trial, which will cost a total of about C$50 million, in the first half of this year. While the company does have the funds to initiate the study, it will eventually have to raise more to get it done, he added.

Giese also noted that the Alberta-based biotech is close to completing patient enrollment in the Canada/Europe MS trial, and that data from an interim analysis of the trial are due 16 months from now, which isn't that far off in biotech terms. This trial has passed six safety reviews by an independent board to date.

Geron Spinal Cord Treatment Produces Nerve Growth

Geron Corp. (GERN) said Wednesday its stem-cell treatment for spinal-cord injuries produced nerve growth in animal models, potentially removing a first hurdle for it to begin clinical trials in the future.

Shares of the company were recently trading up 29 cents, or 3.4%, at $8.94, on heavy early volume.

Menlo Park, Calif.-based Geron said Wednesday findings for the treatment, GRNOPC1, affirmed the company's cell-based approach to spinal-cord injury.

When injected into animal models, the therapeutic stimulated nerve growth and extension, in addition to its already reported remyelinating activity - which repairs the coating around the neurons without which nerves are unable to function.

"The multiple functions of GRNOPC1 affirm the potential therapeutic utility of our cell-based approach to the repair of spinal cord injury and provide multiple mechanisms within a single therapy to achieve functional recovery," said Thomas B. Okarma, Geron's president and chief executive officer.

Geron operates at a loss, and recently reported its third-quarter loss narrowed to $9.84 million, or 15 cents a share, from $11.9 million, or 21 cents a share, in the year-earlier period.

But research advances are lending hope to doctors that spinal-cord injuries will one day be treatable.

"They are on the road to entering the clinic and this is the first step for that to proceed," said WBB Securities analyst Stephen Brozak, who had no conflicts to report.

The treatment could improve survival of the neurons, and allow formation of alternative circuitry, where they have been disrupted due to spinal-cord injury. Return of sensation would markedly improve quality of life, Brozak said.

Although stem-cell research has been inhibited by federal legislation in the U.S., shares of Geron and other companies recently received a lift after an approved constitutional amendment in the state of Missouri was passed protecting the research, and amid hopes a Democrat-controlled House of Representatives will be more amenable towards the field.

There are an estimated 10,000 to 12,000 spinal-cord injuries in the U.S. every year, and a quarter of a million Americans currently live with spinal-cord injuries, most of those being under 30 years old.

FDA Approves Shire Drug For Ulcerative Colitis

The Food and Drug Administration has approved a new Shire PLC (SHPGY) drug to treat mild to moderate ulcerative colitis, the company said Tuesday.

The drug, Lialda, is a once-daily formulation of mesalamine, a drug commonly used to treat the condition.

Ulcerative colitis is a type of inflammatory bowel disease, a chronic condition that causes inflammation of the digestive tract. It's believed that about 500,000 Americans have ulcerative colitis.

Mike Yasick, Shire's senior vice president who oversees gastrointestinal drugs, said Lialda will offer much more convenient dosing than other mesalamine pills, which include another Shire drug, Pantasa. Those drugs require dosing three to four times daily and six to 16 pills.

A survey released last month by the Crohn's and Colitis Foundation of America found that 65% of patients with ulcerative colitis aren't compliant with their medication, which can make the disease more difficult to control.

Shire said Lialda would be available during the first quarter of this year.

More serious cases of ulcerative colitis are treated with steroids and other medications, such as Johnson and Johnson's (JNJ) Remicade, designed to block a protein involved with the inflammatory process.

OraSure Sees Oral Hepatitis C Test Trials Ending In 2007

OraSure Technologies Inc.'s (OSUR) chief executive Thursday said he expects clinical trials of a rapid oral test for the detection of hepatitis C to be completed by the end of this year.

Once the trials of the test - being jointly developed by OraSure and Schering-Plough Corp. (SGP) - are completed, the company will apply for marketing approval in the U.S., and in Europe soon thereafter.

Last week, Schering-Plough and Bethlehem,Pa.-based OraSure - which already makes the only approved HIV rapid oral test - inked a two-year deal to jointly develop and market the oral hepatitis C test.

The CEO also said OraSure was looking globally to acquire companies with complementary product profiles and with new technologies related to the treatment of infectious diseases.

"We have $90 million in cash right now and are looking to deploy it," Michels said. "We are actively evaluating potential acquisitions and technology-licensing agreements."

Michels said the development of novel treatments for hepatitis C that cut down on treatment time would be a boost to the market's acceptance of the company's test.

Vertex Pharmaceuticals Inc. (VRTX) is engaged in developing such a therapy, as is Schering-Plough, which makes the current standard treatment for hepatitis C, pegylated interferon, called Peg-Intron, which is often used with ribavirin.

The hepatitis C virus is the most common blood-borne infection in the U.S., with around 4 million people suffering from it. It affects as many as 170 million people worldwide. It is the main reason for liver transplants in the U.S.

Michels said as many as 2 million to 3 million Americans who may have the virus remain untested.

While new infection rates have declined in the U.S., and blood is now screened for the virus, those who caught it through blood transfusions in the late 1970s and early 1980s are approaching treatment age, and many more in the population may have the virus but remain unchecked as symptoms can take up to 20 years to appear.

Basilea Shares Jump On Positive Test Results

Shares in Basilea Pharmaceutica AG (BSLN.EB) hit record highs Wednesday after the Swiss biotechnology company said late-stage testing of its superbug antibiotic ceftobiprole showed it to be effective in treating complicated skin infections.

The Basel-based company said ceftobiprole demonstrated high cure rates in a range of patients, including those with methicillin-resistant Staphylococcus aureus, or MRSA, and diabetics with foot infections. Basilea also said it plans to submit its first regulatory filing for the drug this year.

Analysts said the positive results weren't a surprise, given that the drug had already been proven successful in an earlier late-stage study, but are still good news for the company.

"A good outcome was expected, but this trial was perceived as slightly riskier than earlier ones, so this (outcome) is nice," said Denise Anderson, an analyst at Kepler Equities, who believes ceftobiprole will become best-selling antibiotic globally with annual sales of at least $1B.

Still, Anderson doesn't plan to change her estimates following the latest trial data, noting the stock is already generously valued. She has a reduce rating on Basilea with a CHF170 target price.

At 0953 GMT, shares in Basilea, which plans to jointly sell ceftobiprole with Johnson & Johnson (JNJ) unit Cilag GmbH International in North America and major European countries, were up 3.1% at CHF220.50 - off its earlier record high of CHF221.90 - in a lower Swiss market.

Basilea said 91% of clinically evaluable patients in the Phase III trial were cured with ceftobiprole, compared to 90% of patients treated with combination therapy.

The clinical response in patients with diabetic foot infections was 86% for ceftobiprole and 82% for comparator combination therapy, respectively.

Over 20% of microbiologically evaluable patients had confirmed MRSA infections. The cure rate for ceftobiprole in MRSA patients was 91% compared to 86% for the comparator regimen.

One third of patients had infections involving a Gram-negative pathogen. The microbiologic eradication rates in these patients were similar at 84% in both treatment groups. Markus Metzger, an analyst at Bank Vontobel, said in a note he expects ceftobiprole to hit the market in 2008. He noted the revenue potential of the antibiotic also depends on the results of testing against another condition.

"Ceftobiprole is reflected in our estimates with a peak sales potential of CHF1.5 billion...across all indications, with the potential to a large part being dependent on the second indication," hospital-acquired pneumoniae, or HAP, he said.

Results from that trial are expected during the second half of 2007, he added. Metzger's price target for Basilea's stock remains at CHF188.

Bacteria such as MRSA have developed resistance to conventional antibiotics in recent decades as major pharmaceutical companies have focused on treatments for chronic lifestyle diseases and new cancer therapies, leaving research to small biotech companies.

Basilea, which listed on the Swiss stock market in March 2004, first signed an agreement with Johnson & Johnson to develop, manufacture and sell ceftobiprole in early 2005. As part of the agreement, the Swiss company would get upfront and milestone payments of up to CHF370 million. It would also get double-digit royalties on worldwide sales if the MRSA drug made it to the market.

volutec Open To Offers As Key Drug Fails Test

Biopharmaceutical company Evolutec Group PLC (EVC.LN) said it would be open to sale offers Wednesday after its key development drug rEV131 failed to produce results in a key trial.

Chief Financial Officer Nicholas Badman said the trial result means all options are on the table, including a potential sale of the company: "Someone may seek to take the whole company," he said, adding: "We are very much open to all routes."

Badman's comments follow an earlier announcement by the company that in a Phase II trial on reducing allergic inflammation after cataract surgery rEV131 performed the same as a placebo.

At 0930 GMT the shares were down 3.5 pence or 18% at 14.75 pence, leaving the company with a market value below GBP4 million. The group listed in August 2004 at 125 pence per share.

The compound rEV131 was being tested as a treatment to combat inflammation after post-cataract surgery, but the company's statement Wednesday said the trial found "no significant differences" between rEV131 and the placebo.

In December Evolutec's shares slumped 70% in a day's trading after negative results using rEV131 to treat hay fever were announced. Evolutec is now scrapping investment in the drug. However it is pursuing another compound, rEV576, which it says has shown potential in therapy for myasthenia gravis and Guillain-Barre Syndrome.

The CFO would not say whether the company has received any expressions of interest, or whether it has approached potential buyers, nor would he give a timeline for a potential sale of the company: "There is no time line but we are going to actively pursue [options], we will do whatever."

The CFO said the group has enough cash for the foreseeable future and that the company is undervalued: "We're worth a lot more than our current share price suggests, we've got the cash and there's a lot of potential value in rEV576."

Nomura Code analyst Gary Waanders said the trial result leaves little value in the company: "This was the supporting indication for their lead product, that's gone now so there's not much in their pipeline of any real value," Waanders said, adding: "It's pretty hard to see where they might go from here."

Waanders highlighted that the group is trading at a discount to its cash reserves of GBP8.7 million or 33 pence per share, and said it may be a target for a biotechnology company looking to top up its cash.

The analyst does not have a rating on the company.

The compound rEV131 had been touted as a potential blockbuster, and in October the group raised GBP2.8 million to fund the trials of the drug.

The Reading, UK based company's drugs are based on compounds found in the saliva of blood-feeding ticks. Ticks can remain undetected on their hosts for weeks and the company's products aim to use compounds to treat allergic, autoimmune and inflammatory diseases.

The company's only other pipeline drug, rEV576 is at the preclinical stage of trials for its use as a treatment against muscle weakness, or myasthenia gravis. It is also being tested as a treatment for Guillain-Barre Syndrome, a nerve system disorder and against asthma and heart attack.