results announcement

Alchemia’s board and management remain confident the Company will deliver commercial outcomes from its R&D programs to ultimately enhance shareholder value.

22 August 2008

Alchemia Announces solid progress over the past 12 months
BRISBANE, AUSTRALIA: Alchemia Limited (ASX:ACL) today announced its audited financial results for the full year to 30 June 2008.
Alchemia has made substantial progress with its generic fondaparinux, cancer drug targeting (HyACT®) and drug discovery (VAST®) programs. Alchemia’s CEO, Dr Peter Smith said “The impending commercialisation of generic fondaparinux and anticipated revenues in calendar year 2009 will form a strong financial base for Alchemia. This will enable the Company to advance its drug targeting and drug discovery technologies to further build a sustainable pipeline of opportunities for future commercialisation.”

Operational performance and highlights for the year
The key highlights for the financial year included:
generic fondaparinux;
•
Successful technology transfer to Dr Reddy’s with no significant technical hurdles remaining;
•
Progress on target for approval in the first half of calendar 2009
•
Receipt of Arixtra® sales data, with sales up 87% for calendar year 2007
cancer drug targeting (HyACT®);
•
Receipt of the final, Phase II clinical trial report for HA-irinotecan confirming a 116% in progression-free survival compared with irinotecan alone.
•
Successful meetings with the US FDA and two European regulatory authorities on a potential pivotal clinical trial design for HA-irinotecan
•
Establishment of a Clinical Advisory Board (CAB)
•
Granting of a key HyACT® patent in Europe
drug discovery (VAST®);
•
Progress in completing the VAST drug-discovery system, applicable to a broad range of therapeutic targets, due for completion early in 2009
•
Advancing drug “hits to leads” in the drug discovery collaboration with Euroscreen s.a.
•
Establishment of a Scientific Advisory Board (SAB)
•
Progress with the Pain Research Group of the University of Queensland aiming to develop new opioid targeting drugs without the side-effects of traditional analgesics
and in Board news
•
Appointment of a new non executive director, Mr. Carlo Montagner

Generic Fondaparinux
Alchemia and Dr Reddy’s have been working hand-in-hand to complete the first commercial scale manufacture of generic fondaparinux together with the required documentation for the ANDA filing. Fondaparinux’s complex synthesis has inevitably presented challenges at commercial scale, however, these challenges have now been overcome. Generic fondaparinux approval and launch is expected in the first half of 2009, depending on review time at the FDA.
Given the complexity of the synthesis, Alchemia continues to believe that its generic fondaparinux will be the only generic brought to market, restricting competition to two drugs, Alchemia’s fondaparinux and GSK’s Arixtra®. Typically a first generic will take 40-50% of the prescription share, and with Alchemia’s fondaparinux expected to be the sole generic, a modest level of price discounting is anticipated. The Company therefore expects generic fondaparinux to be a highly profitable product. Alchemia also believes the complexity of the chemistry, and associated IP, required for fondaparinux scale-up presents a significant barrier to entry to competitors considering the manufacture other generic versions of Arixtra® and is unaware of any potential generic competition.
Global sales of Arixtra® were up from $US 155 million in the year to June 2007 to $US 250 million in the year to June 2008 (+61%). Based on the trend in Arixtra® sales, the Company expects to receive at a minimum a 50% profit share from the sale of generic fondaparinux and, at a maximum, a 60% profit share.
In the heparin-drug market Arixtra® is the only drug not derived from biological sources – i.e. it is a fully synthetic molecule. For this reason it was not affected by the recent recall of unfractionated heparins and some low molecular weight heparins from the market, after the raw material used in their manufacture was found to be contaminated. Being a fully synthetic generic, it will be approved through the ANDA (505(j)) route at the FDA.

Cancer drug targeting technology (HyACT®)
One of the primary objectives of Alchemia’s clinical team during 2008 was to develop and pursue a clear path to market for HA-irinotecan, preferably via a single and final pivotal trial. To achieve this, Alchemia’s clinical team met with US and European regulatory authorities in April of 2008. After speaking with these authorities the Company believes that a single clinical development program may be designed and implemented that will satisfy the needs of both agencies. Furthermore, the FDA agreed that in the US, Alchemia could file for approval through the 505(b)(2) NDA regulatory route, as HA-irinotecan is a new formulation of a currently approved drug, irinotecan. This regulatory process will save time and money, compared to a new drug application. Alchemia is currently planning to submit for a Special Protocol Assessment with the FDA, which would provide further confidence that the clinical trial design, endpoints, and statistical analyses for a Phase III study of HA-irinotecan will be acceptable to the FDA.
In November 2007, Alchemia announced the formation of the Clinical Advisory Board (CAB). The Board consists of leading colorectal clinical oncologists from Australia, the US, UK and Europe. The CAB is charged with guiding the development of the Company’s oncology products and technology (HyACT®). The board’s input is expected to maximise the company's ability to deliver results that are clinically and commercially significant. The CAB will be chaired by Dr Peter Gibbs, who has been the Principal Investigator for the two successful HA-irinotecan trials run in Australia to date.
The past year also saw the Company granted a key HyACT® patent in Europe, further consolidating Alchemia’s claim to future revenues from the product.
Alchemia continues to investigate the applicability of the HyACT® technology platform to enhance the safety and efficacy of other anti-cancer drugs. Based on results from preclinical studies, the Company remains confident that the technology is suitable for the formulation of many drugs, including therapeutic proteins such as monoclonal antibodies.