Pfizer dud may open door to Liponex drug

|

liponexIt's a sure bet drug developer Liponex Inc. will be feeling one of those things at the end of February when it reports do-or-die clinical results for a new treatment to raise levels of "good" cholesterol and reduce heart disease.

"This is the Holy Grail of cardiovascular R&D," claims Duncan Emerton, an analyst with British market research firm Datamonitor PLC, referring to the link between raising good cholesterol, or HDL, and melting plaque buildup in arteries that can cause heart attacks and stroke.

On the other hand, statin drugs, of which Lipitor is the best known, have created a $32-billion-a-year (U.S.) market by lowering "bad" cholesterol, or LDL. But they only halt the buildup of additional plaque. Studies have shown that a 1-per-cent drop in LDL can reduce the risk of developing heart disease by 1 per cent, but a 1-per-cent increase in HDL can reduce the risk by 3 per cent.

Liponex's data in the next few months could turn the Ottawa-based company into a household name now that Pfizer Inc. has pulled the plug on its highly touted good cholesterol-raising drug torcetrapib. Deaths among patients taking it in a late-stage study were 60 per cent higher than in a group who didn't get the drug.

"A major competitor has faltered but the world still needs novel HDL therapies, and we're one of the companies in the running," said Liponex president and chief executive officer Bill Dickie.

Investors are betting that the company's mid-stage clinical results match the safety and efficacy of earlier studies. The stock has climbed more than 45 per cent since the beginning of December when the Pfizer drug failed, closing at $1.54 (Canadian) on the Toronto Stock Exchange yesterday.

Dundee Securities analyst David Martin calls Liponex an "idea of interest" now that torcetrapib has been discontinued. A positive outcome for Liponex in this clinical study, he predicts, could lift its market value to at least $100-million, indicating a stock price of around $5.

Liponex was created in 2000 as a spinoff from the University of Ottawa Heart Institute by Dan Sparks, who is now chief scientific officer of the company, to develop its CRD5 drug, a soybean extract that is closely related to a molecule already present in the human body.

Angel financiers in Ottawa injected $2.5-million to get Liponex through early-stage testing in healthy volunteers. Those studies found that CRD5 raised good cholesterol by 20 per cent and reduced triglycerides by 40 per cent. Based on those results, Liponex raised $11.5-million in an initial public offering in mid-2005 to finance the second phase of testing.

"This next result is quite important to us," Mr. Dickie said. "What we want to see is a result that can put us on the fast track to a partnership for CRD5. Getting taken out is also a possibility." Liponex has already held talks with major drug companies to finance continued development and potential marketing of CRD5 but the "consensus was we didn't have enough data yet, which is why this Phase II is so important," he added.

The primary endpoints of the Canadian study are safety and HDL levels, with secondary endpoints of reducing LDL and triglycerides. Patients are receiving three different doses of the reformulated drug and Mr. Dickie said the best outcome would be high efficacy at the lower doses in order to develop a pill that can be taken conveniently a couple times a day.

Working in Liponex's favour is that CRD5 has a different mechanism of action than the failed Pfizer drug, which was being developed in combination with Lipitor in order to extend Lipitor's franchise in 2010 when its patent protection ends. CRD5 works by increasing levels of a protein that is a key component of HDL production and keeping it from being removed from the body.

Jennings Capital analyst Shameze Rampertab likes Liponex's chances of exceeding the 20-per-cent efficacy of the early tests because the drug "is not foreign to the body so there's a better probability of not having any significant side-effects."

The 20-per-cent threshold is important, he said, because B vitamin niacin, which is sold as a drug in several extended release forms, raises good cholesterol 20 per cent to 30 per cent but causes skin flushing that needs to be countered with aspirin. "If Liponex can get that efficacy without side-effects, it has a real winner."

© The Globe and Mail