Solbec Managing Director Stephen Carter Wednesday, December 04, 2002
This week we speak to Solbec Pharmaceuticals Managing Director Stephen Carter. He explains to us the Special Access Scheme and why SBP’s drug was accepted for this scheme and what key milestones the company hopes to achieve by June 2004
For the benefit of those that are unfamiliar with Solbec Pharmaceuticals Ltd (SBP) can you give us some background information on the company?
Solbec Pharmaceuticals Ltd (SBP) is listed on the Australian Stock Exchange and in November 2002 was capitalised at more than $20 million.
The company is an emerging biotechnology company with a promising portfolio of projects under development to address large global markets.
I will focus on Solbec’s main biotechnology assets, being:
a. The 100%-owned anti-cancer combination of glycoalkaloids (SBP002) isolated from the fruit of Solanum l linnaeanum, an imported weed growing across Australia and known commonly as devil’s apple, and
b. The technology that underpins a range of steroid creams for topical application in hormone replacement therapy (HRT). SBP is farming in to own 49% of Lawley Pharmaceuticals which manufactures a range of HRT creams such as Progesterone, Oestradiol and Testosterone. Clinical trials have demonstrated promising results and the products could provide early cash flow for the joint venture.
SBP was previously a mining company (Britannia Gold NL) and has transformed itself into a biotechnology group. The Company has recruited an experienced industry Managing Director and Regulatory Affairs Manager. It contracts all its formulation, development and clinical trials programme thus achieving good efficiencies in a low overhead environment.
SBP released encouraging pre-clinical trial results for its anti-cancer drug SBP002. The drug has also been administered to about 40 patients under the Therapeutic Goods Administration’s Special Access Scheme (SAS). Can you briefly describe your clinical trial results to date?
SBP002 is currently in the pre-clinical phase of trials with most of the testing being conducted in animal models. Some testing has been done on human participants under the Special Access Scheme.
The results of the pre-clinical trails have been reported to the market as part of the Company’s continuous disclosure obligations. In summary, the reported results have been most encouraging and indicate that SBP002 may be effective against a broad range of cancers.
Solbec is utilising the contract services of a number of research and clinical institutions for their trials.
The pre-clinical work is ongoing and we are currently in discussions with investigators regarding Human Phase I clinical trials.
What is the Special Access Scheme and why was SBP’s drug accepted for this scheme?
The SAS is the Federal Governments “Compassionate Use Scheme”, it allows patients who have undergone all accepted therapies without success access to experimental medicines that are not yet in the market place.
Solbec met with the TGA and presented the data available to it all the time with regard the clinical safety and. Toxicology. We requested that SBP002 be made available to patients under the SAS and this was granted. Details of all new patients are sent to the TGA at commencement of each treatment.
To date we have had good results in many of these patients ranging from:
Increased well being.
Tumour size reduction.
Reduced tumour growth rates.
Reduction in biochemical markets and
Extended expected life span.
Tumour eradication.
Can you briefly explain why SBP have chosen to focus its clinical development on mesotheliomas and malignant melanomas?
Whilst SBP002 appears to target many cancers, we have chosen mesothelioma and malignant melanoma as this qualifies SBP002 for the Orphan Drug Program (Fast Track).
The program was instigated in the 1980s to encourage pharmaceutical companies to develop drugs to treat rare diseases (incidence less than 5 per 10,000) by:
earmarking additional grants for research;
providing special tax benefits;
providing between 5 and 10 years of protection from generics for registered non-patented drugs, depending on the nominated market;
fast-tracking registration (eg, as short as 9 weeks for FDA approval versus the average of 29 months), and
condensing the clinical trials stage down to completion of pahse 2, only.
Registration of SBP002 as an orphan drug for mesothelioma only, when it acts against so many cancers, is not a pharmaceutical marketing impediment since over 90% of anti-cancer drugs are prescribed off label.
SBP met with the FDA earlier this year. What was their response?
The FDA meeting was attended by a full complement of FDA officials, from Directors to assessors. SBP were well received and the FDA informed SBP that based on the information presented SBP002 would be fast tracked and should be put through the Orphan Drug Program. SBP has continued to keep the FDA informed of its progress and we are continuing to get very good response from them.
What is the potential market for SBP002 and what percent of the market do you hope to capture?
The market for cancer drugs world wide is increasing exponentially in 2000 it was about $16 billion and it is envisaged to be over $30 billion by 2004. Taxol, the worlds largest selling anti-cancer drug, has sales of about $3 billion/year.
SBP in time could achieve sales of this magnitude, but initially we hope to capture sales of about $250 million per year by 2006, which equates to 0.5% of the market. This is very conservative and will be reviewed as the project matures.
Are you in negotiations to form a partnership to commercialise SBP002. Can you explain the type of partnership that you would be interested in entering into to commercialise SBP002?
We are in discussion with a number of companies with regard the potential to work together on SBP002. As you can understand these discussions are confidential and I can’t discuss specifics.
Our ideal situation would be a co-development with an up-front payment and payment of milestones with a royalty on sales. This provides a low risk entry for any partner and ensures the ongoing income for SBP.
SBP is in the process of extending its technology to diagnostic applications. Can you explain what these products are and how you plan to commercialize them?
Since cancer is recognised often decades after the initial transformation event and since prognosis improves with early detection, diagnostic tools that offer earlier detection are in great demand. BEC, which shows high specificity binding to a wide range of cancer cells, is an ideal candidate for very early diagnosis applications.
Two approaches are available to the Company, being: a. A laboratory-based test that would employ a rhamnose triglycoside to selectively bind cancer cells in sample of a blood to a diagnostic plate. Additional EEL’s on the surface of captured cells would be used to visualise positive tests using the binding of BEC molecules bearing an appropriately sensitive tag. A machine read positive test result would be obtained when many cells were bound leading to a high reading for the tag.
b. Cancer masses could also be visualised in patients after introducing BEC pre-labelled with a suitable tag for visualising the internal sites of binding within the patient’s body using such techniques as MRI, ultrasound and X-ray detection. The tag would be chosen depending on the required sensitivity and availability of scanning equipment. This could provide early, comprehensive detection of cancer masses.
We are focusing on the development of a anti-cancer treatment and would be looking to partner out the diagnostic application.
Can you give an indication of the potential markets for these products?
The size of the market is unknown as there is no product currently available to compare against. The market will be significant and in the billions of dollars for the right product.
The western world is moving more and more towards early detection with private CT scanners being set up in major cities. The potential for a SBP CT scanning agent would increase the effectiveness of annual scanning immensely.
What is your current cash balance and do you propose to raise more funds for the future?
As at the September Quarter 2002, SBP had $1,594,000. We have approximately $1.5 million of tradable assets and $1.5 million in mineral tenements that we are in the process of selling..
SBP is debt free and has sufficient working capital to prosecute the next two years of development. Subject to share price performance and a share price in excess of 20 cents per share around June 30 2003, Solbec can expect an injection of $31 million from the conversion of listed options. There are no plans at this time to raise other funds.
What are the key milestones that you hope to achieve by June 2004?
By June 2004, we plan to have achieved:
1) Phase I and Phase II clinical trials. 2) IND and NDA for SBP002 with TGA and FDA. 3) Registration of Lawley Hormone products in Australia and New Zealand. 4) Completed negotiations and have at least 2 strategic marketing partners. 5) Complete construction and commissioning of our GMP manufacturing plant.
There are many other milestones that will be achieved during this time, but these are major milestones for the future success
