nature biotechnology • VOLUME 20 • MARCH 2002 • http://biotech.nature.com

BUSINESS AND REGULATORY NEWS

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On January 16, Cubist Pharmaceuticals(Lexington, MA) announced that its

antibiotic, Cidecin, had failed to meet thestatistical endpoint in a phase 3 trial for thetreatment of community-acquired pneu-monia (CAP), sending its share priceplummeting 50% to $16. It was perhaps anexpected reaction from the market becausemuch hangs on Cidecin, Cubist’s onlyproduct in late-stage trials. Cidecin failednot because it was ineffective, but becauseit was not effective enough, at least to satis-fy the new demands introduced last year bythe US Food and Drug Administration(FDA; Rockville, MD). Although wellintentioned, the new levels of stringencythat the FDA has contemplated enforcingcould make drug development prohibitive-ly difficult for antibiotic drug developers,including Cubist.

Cidecin (daptomycin) kills Gram-positivebacteria, a major cause of CAP and compli-cated skin and soft tissue infections (cSSTs)and is, according Cubist’s chiefscientific officer Francis Tally, a “company-building drug.” However, although phase 3trials showed that Cidecin successfully metend-points for cSSTs, Cidecin has not provedto be as effective as the therapeutic “gold

standard,” Roche’s cephalosporin antibioticRocephin, in the treatment of CAP.

Drug developers must convince regulatorsthat a novel medication is either more effectivethan a placebo, or equivalent to an existingproduct. New antibiotics must be shown to be“non inferior,”within specified limits, to a des-ignated comparative antibiotic, ideally in twodifferent infectious diseases. In the first of theCAP studies, Cidecin was effective in 79% ofpatients compared with 87% of patients treat-ed with Rocephin, thereby failing the non-inferior “test” by a narrow margin.

The problem for Cubist lay in the level ofequivalence—or “non inferiority”—of the testdrug in the clinical trials. To date, the FDAfound acceptable trial data showing that therewas a 95% probability that the cure rate of thetest antibiotic was not more than 10–20% (the“delta value”) lower than that of the compara-tor. However, last year regulators starteddemanding companies provide delta values ofno more than 10%. Cubist took on this chal-lenge, but failed to reach this goal in the CAPtrial. (Cidecin would have met a 15% deltarequirement.)

The regulatory changes afoot were flagged-up earlier this year in the professional journalClinical Infectious Diseases (34, 420–444,

2002). The letter’s authors, David Shlaes, vicepresident for infectious diseases at Wyeth-Ayerst Research (Pearl River, NY), and RobertMoellering, head of the department ofMedicine at Beth Israel Deaconess MedicalCentre (Boston, MA) and Harvard MedicalSchool (Boston, MA), say that evidence thatthe FDA was to enforce increased stringency inantibiotic clinical trials “threw the pharmaceu-tical industry into a panic.” This, they claim,contributed to the recent withdrawals by EliLilly (Indianapolis, IN) and Bristol-MyersSquibb (New York) from antibiotic drug dis-covery. Industry insiders also suggest thatGlaxoSmithKline (London) has been contem-plating similar measures. As Tally says, “The10% delta is killing antibiotic development.”

Should the FDA continue to demand thatcompanies adhere to the 10% delta require-ment, antibiotic development could becomeprohibitively expensive. To reduce the deltavalue from, say, 15% to 10%—effectively toincrease the stringency of a trial—a companywould have to recruit twice as many patients.Because patients are the most significant costin late-stage trials, doubling the number ofpatients would double the cost of the trial.Tally says it currently costs around $21,000 perpatient in a phase 3 study, and the proposedchanges could force trial costs up to around $5million. Larger trials also take much longer torecruit.“The trial [for a new antibiotic] wouldnever get done,” says Cubist’s Tally.

Should the cost of development rise, drugdevelopers would probably become even morereluctant to invest. Indeed, it was economicsthat deterred the pharmaceutical industryfrom antibiotic development during the pasttwo decades, providing the current openingfor smaller anti-infective specialists. Fewantibiotics become blockbuster products, andmost of the 18 or so on the market generatearound $200 million to $300 million annually.“Doubling the costs of the trial reduces thereturn on investment below a magic numberand they [the drug industry] won’t put thedrug into its pipeline,” says Tally.

Nevertheless, there are clear attractions inantibiotic drug discovery. Preclinical studies ofantibiotics are much more predictive of effica-cy in late-stage clinical trials than those for anyother class of drug, reducing the risk ofunpleasant surprises in phase 3. Ken Powell,the CEO of anti-infective startup ArrowTherapeutics (London) explains: “If the drugkills the bug in the lab and the drug is bioavail-able, then you can be pretty sure that the com-pound will work in the clinic.”

Moreover, there is a continuing and sub-stantial market for antibiotics. Bacteria arenaturally adept at developing resistance toexisting antibiotics; this generates the need fornovel chemistries and provides an opening forbiotechnology companies. (The drug indus-

Cubist highlights FDA’s antibiotic resistance

Companies specialising in antibioticsCompany (location) Focus, products in clinical trials

Cubist Pharmaceuticals Antibiotics targeted at the enzymes called aminoacyl-tRNA (Lexington, MA) synthetases, Cidecin (daptomycin)

Versicor Antifungals and antibacterials, anidulafungin (phase 3), (Waltham, MA) dalbavancin (phase 2)

Essential Therapeutics Anti-infective development(Waltham, MA)

Inhibitex (Alpharetta, GA) Antibody-based blockers of the initiation of infectionMicrologix Biotech Antimicrobial peptides

(Vancouver, BC, Canada)Elitra Pharmaceuticals Functional genomics for discovery of novel antimicrobials

(San Diego, CA) EluSys Therapeutics Bispecific antibodies used to clear toxins and pathogens

(Pine Brook, NJ)Paratek Pharmaceuticals Reversal of the mechanisms of drug resistances to

(Boston, MA) resensitize bacteria to existing antibiotics Phage Therapeutics Bacteriophage products for the treatment of antibiotic-resistant

(Bothell, WA) and other bacterial infectious diseasesQuorex Pharmaceuticals Reducing infection by interfering with the communication

(Carlsbad, CA) between bacteriaRiboTargets Targeting RNA for developing antiinfectives

(Cambridge, United Kingdom)IntraBiotics Pharmaceuticals Iseganan (phase 3)

(Mountain View, CA)NewBiotics (San Diego, CA) Drug development targeting drug-resistance genesArrow Therapeutics High-throughput functional genomic’s assays fore treating

(London, UK) antibiotic resistance and cancers resistant to therapeuticsRib-X Pharmaceuticals Development of antibiotics and novel drug targets based on

(New Haven, CT) ribosome inhibitionBasilea Pharmaceutica Roche spinout focused on antibiotic development

(Basel, Switzerland)

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BUSINESS AND REGULATORY NEWS

http://biotech.nature.com • MARCH 2002 • VOLUME 20 • nature biotechnology 207

try, says Powell,“spent too much time creatingbetter and better versions of the same olddrugs rather than looking for new targets.”)According to UBS Warburg (New York), anti-infectives are the fourth-largest therapeuticcategory after cardiovascular, CNS andinflammatory diseases, generating $22 billionin sales during 2000. Biotechnology startupsare gearing up to capture some of this market.Powell says that the number of anti-infectivestartups has doubled in the past few years, andthat there is “plenty of space” for new compa-nies (see Table). However, there could beproblems ahead says Shlaes: “For small com-panies, an increased stringency for trials willmake them more dependent on pharma [forfunding clinical development] at a time when

The US Senate is set to review new legisla-tive proposals and to resume a postponed

debate on human cloning, including whethernuclear transplants should be permitted tofurther stem cell research. Many elements ofthis debate also are central to the agenda of thenewly formed President’s Council onBioethics, whose members convened for thefirst time in mid January.

Amid such meetings and hearings with stillothers being scheduled, a panel from the USNational Academy of Sciences (NAS;Washington, DC) weighed in on these mattersduring January. They called for legal sanctionsagainst human cloning for reproductive pur-poses, but reiterated an NAS endorsement ofcloning to produce stem cells for research pur-poses, a process it prefers to call nuclear trans-plantation. In its final report, this NASpanel—which met publicly in mid-2001 (Nat.Biotechnol. 19, 791, 2001) and was chaired byIrving Weissman of Stanford University(Stanford, CA)—is now calling for a “legallyenforceable” ban on human reproductivecloning, one that would carry “substantialpenalties” and would apply to clinics in theprivate sector to which other federal regula-tions have not applied.

“The proposed ban … should be reviewedwithin five years, but it should be reconsideredonly if a new scientific review indicates thatthe procedures are likely to be safe and effec-tive, and if a broad national dialogue on soci-etal, religious, and ethical issues suggests thatreconsideration is warranted,” Weissman says.He and other members of the NAS panel tookcare to distinguish reproductive cloning fromnuclear transplantation as a means for pro-ducing stem cells, a procedure that would also

use blastocyst cells from very early-stagehuman embryos but would not involveimplanting them into a woman’s uterus forfurther development.

The kind of dialogue alluded to byWeissman is very much the sort of national-level discussion that the members of thePresident’s Council on Bioethics are seekingto lead, according to council chair LeonKass, a bioethicist from the University ofChicago (Chicago, IL). He calls the 18 mem-bers of the council, including himself andseveral additional bioethicists, five biomed-ical researchers, four lawyers, severalphilosophers and social scientists, and ajournalist, “intellectually diverse” and saysthat they are “liberated” from a need to seekconsensus on issues that they consider.Although the first meeting of the councilmembers in mid-January was abbreviated,there is no doubt that human cloning is thenear-term issue on which they intend tofocus. The council, which was establishedlast November for a two-year (renewable)term by an executive order of President

Bush, plans to meet six to eight times peryear (Nat. Biotechnol. 19, 791, 2001).

One practical issue is whether the Councilon Bioethics will discuss that first agenda itemin time to influence a heated congressionaldebate over human cloning, scheduled toresume in earnest this month. A recent legisla-tive addition to this debate is a bill co-sponsored by Senator Tom Harkin (D-IA) andSenator Arlen Specter (R-PA), “The HumanCloning Ban and Stem Cell ResearchProtection Act.” If enacted, this bill effectivelywould codify many recommendations in therecent NAS report, permitting cloning for var-ious research purposes—particularly studiesof embryonic stem cells—but imposing bothcriminal and civil penalties on anyone usingcloning techniques for the purpose of repro-ducing a human.

However, last year the House ofRepresentatives passed a bill that wouldbroadly prohibit such research along withreproductive cloning. Moreover, SenatorSam Brownback (R-KS) has already provenhimself an outspoken proponent of thosesweeping restrictions, offering similar legis-lation in the Senate and, late last year,maneuvering to attach its restrictive provi-sions to an essential appropriations bill. Herelented only on the promise that the debatewould be rejoined this year.

Representatives of the biotechnologyindustry and also the academic research com-munity are endorsing the NAS report and theHarkin-Specter legislative approach thatwould permit cloning of human embryonicstem cells for research purposes, but ban theiruse for reproductive purposes. For example,the US Biotechnology Industry Organization(BIO; Washington, DC) views reproductivecloning as “dangerous and fraught with ethicalconcerns” and thus “supports a legallyenforceable ban on [its] practice,”according toMichael Werner, vice president of bioethics atBIO. Like NAS, BIO supports research onhuman cells “using nuclear transplantationtechnology, especially as applied to stem cellresearch,” noting its “potential to provide newtherapies and cures …”

Jeffrey L. Fox, Washington, DC

the large companies may be dissuaded fromcontinuing in the area.”

Meanwhile, Cubist is deliberatingwhether or not to submit a filing forCidecin for cSST alone, and Shlaes pointsout that the FDA is backpedaling, searchingfor ways to ensure the safety and efficacy ofnew antibiotics, without “driving theindustry out of the business.” Indeed, theFDA was to hold a public meeting of itsanti-infectives advisory committee onFebruary 19–20 (after Nature Biotechnologywent to press), and the FDA plans to pub-lish a response to Shlaes and Moellering’sletter in the March 15 issue of ClinicalInfectious Diseases.

Liz Fletcher, London

Panels jockey for position in US debate on cloning

The already murky outlook for medicalbiotechnology in the US is being fur-

ther clouded this year by big pharma’sfinancial woes and productivity slump. Fornow, biotechnology companies can’t counton the large-cap pharmaceutical industryto provide timely acquisitions or evenmajor capital for any but the most promis-ing and risk-free products. And the

ImClone (New York) debacle surroundingErbitex is expected to further freeze thealready chilly investment climate.

Big drug makers have not done wellrecently. Merck (Whitehouse Station, NJ)and Schering-Plough (Madison, NJ)shares, for instance, suffered a punishing37% decline during 2001, while Bristol-Myers Squibb (BMS; New York) stock fell

Troubled big pharma turns away from biotech

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