BOT - Anything but charting, page-4942

Competition to SB

In response to Floating City’s post about market reports I decided to share a little bit of research with the BOT community. Specifically I have dug into THVD-102.

I think with any investment research it is important to understand a drug’s potential future revenue and any drugs that might eat potential future market share.

To understand THVD-102 lets follow its journey. There are some very illuminating outcomes and familiar characters.

THVD-102 was initially developed by TheraVida Inc in 2016. TheraVida developed a proprietary patent protected product for the treatment of hyperhidrosis. The company ran a small phase 2 trial combining Oxybutynin (muscarinic receptor antagonist) and Pilocarpine (muscarinic receptor agonist). Importantly this combination of drugs was a possible step forward in hyperhidrosis treatments.

Phase 2 trials found that Oxybutynin + placebo treatment performed similarly to the combination therapy of Oxybutynin and Pilocarpine, however there was a statistically significant improvement in associated dry mouth symptoms for patients on the drug combined with Pilocarpine.

The severity of dry mouth side-effects stopped people wanting to take the Oxybutynin alone.

This was a desirable outcome, the combined THVD-102 drug was thought to be a potential oral treatment for hyperhidrosis and a competitor to Allergan’s Botox injections.

Enter Roivant Sciences Ltd a self-described next generation “big pharma” company proclaiming that its competitive advantage is that is adaptable and nimble. With a NASDAQ (ROIV) listing and current shareprice $9.70, Market Cap $7.4 Billion and 758.43 million shares on issue.

Roivant’s Mission statement:

“To improve the delivery of healthcare of patients by treating every inefficiency as an opportunity.”

Roivant’s Goal:

“To identify novel or clinically validated targets and biological pathways in areas of high unmet medical need. Then seek to acquire, in-license or discover promising drug candidates against those pathways or targets.”

Roivant Sciences Ltd has developed an agile “VANT” model. Vants are subsidiaries of Roivant’s Sciences Ltd. These Vants specialise in therapeutic areas including immunology, dermatology and oncology.

Dermavant founded in 2014 is Roivant Sciences -dermatology subsidiary. Dermavant’s mission is to advance clinical phase dermatology candidates and is willing to carry out preclinical work.

Dermavant’s flagship drug is VTAMA (Tapinarof 1.0% cream) which gained FDA approval for treatment of plaque psoriasis in adults, in May 2022. Dermavant purchased all global rights to Tapinarof (except in China) from GSK in 2018. They also assumed the responsibility for all developmental milestones owed to third parties. Roivant paid GSK US$330 million and agreed to run all phase III clinical trials for both psoriasis and atopic dermatitis.

Dermavant paid GSK $198 million for the preclinical drug with a further $132 million in developmental milestone payments.

VTAMA is also a potential treatment for atopic dermatitis in children and adults. The drug yielded positive phase III outcomes as a safe and effective treatment for adult and paediatric (non-steroidal option) for the treatment of dermatitis, in March 2023.

Dermavant has a history of buying pre-clinical drugs and running phase III themselves (presumably to get the drug for cheap). This has proved to be a winning formula for VTAMA through to Feb 2023 the company had sold 100,000 prescriptions, written by 8,600 unique prescribers for plaque psoriasis. Net product revenue for the December 2022 qrt was US$9.2 million.

Back to THVD-102 – In 2018 Dermavant bought the rights to TheraVida ‘s hyperhidrosis drug THVD-102 and renamed the drug RVT-504. This deal consisted of an upfront fee and milestone commitments of a undisclosed size. The plan was to run this oral drug through phase III trials and hopefully launch it as a competitor to Allergan’s BOTOX.

Fast forward to June 2022 and Pfizer partnered with Roivant Sciences in a deal to launch TYK2 inhibitor Brepocitnib for the treatment of dermatomyositis and lupus.

This was an expensive deal and meant that mothballing several Vant subsidiaries would be necessary. Dermavant lost half its dermatology program funding. RVT-504 for hyperhidrosis was cut. So this drug has not been developed any further.

Now to the interesting part. Howie McKibbon Botanix Pharmaceuticals current Chief Operations Officer most recently served as Senior Vice President for world-wide commercial operations at Dermavant from 2017-2019. Therefore he would have been very familiar with hyperhidrosis market as he was present at the time of the Dermavant purchase of THVD-102. He had not doubt realised this competitor had mothballed their program and would be years away from being a viable competitor to the more advanced SB program.

He would certainly be privy to Dermavant’s dermatological program and the fact that this company had a gap in both the acne and hyperhidrosis space.

Roivant Sciences has certainly been known to partner/ licence and buy rights to pharmaceuticals including pre-clinical drugs. I found it interesting that during recent meetings with share-holders there was a huge stress placed on Botanix being very happy to go to market themselves. Perhaps this was a signal that they would not be willing to take a low offer for a preclinical drug from the likes of companies like Dermavant. They are likely holding out for the big offers once the SB has FDA approval and sales. All speculation of course. DYOR.