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Suven Life Sciences plans to raise funds for clinical trials

Suven Life Sciences plans to raise funds for clinical trials
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First Published: Tue, Nov 17 2009. 10 06 PM IST
Updated: Tue, Nov 17 2009. 10 06 PM IST
Hyderabad: Suven Life Sciences Ltd, the Hyderabad-based biopharmaceutical company that is working on 10 new molecules for central nervous system (CNS) disorders or ailments, plans to raise funds for further trials on one of these, SUVN-502.
Venkat Jasti, chairman and chief executive officer, said SUVN-502 is intended for the symptomatic treatment of Alzheimer’s disease, schizophrenia and other disorders of memory and cognition such as attention deficiency and hyperactivity disorder and Parkinson’s disease.
CNS disorders account for around 35% of the total disease burden in the world’s seven largest pharmaceutical markets with sales estimated at over $100 billion (Rs4.63 trillion) out of the total global pharmaceutical market sales of $780 billion.
“The molecule, first-in-class, has successfully completed phase-I studies in Switzerland with promising results. It is now undergoing bridge toxicological studies prior to the initiation of proof of concept or phase-IIa trials on patients,” said Jasti.
“This achievement is indeed commendable for a company the size of Suven especially since it is quite rare for even the biggest of pharma companies to discover a new chemical entity these days and that too for a difficult to treat disease like Alzheimer’s,” wrote Prashanth Reddy, a legal practitioner and patents expert in Spicy IP, a blog on intellectual property rights.
Suven’s Jasti said the company has already secured patents in nine countries including India for SUVN-502.
“Of course, getting a patent is only half the story, the real question is, are the patents being translated into cold, hard cash?” added Prashanth Reddy.
Suven is targeting a commercial launch of the drug in late 2013 or early 2014, Jasti said, and added that the company needs around $20 million to fund the phase-IIa studies.
The company has initiated talks with some global pharmaceutical firms to out-license the molecule. However, Jasti is not confident of attractive upfront or milestone payments when the drug candidate is out-licensed before the tier-IIa studies.
In case the company is not successful in out-licensing the molecule at pre-phase-IIa stage, it plans to raise the required funds for taking up phase-IIa studies by going in for equity dilution, said Jasti.
“Often commercial value of drug discovery and development is not realized until the first evidence that the drug works in patients is demonstrated, often referred to as the “clinical proof of concept” that is where our clinical candidate SUVN-502 is heading,” said Jasti.
Though the firm can take up “clinical proof of concept”, or phase-IIa studies, on its own, Jasti says, the firm needs to certainly collaborate with some pharma giant after the phase-IIa studies—for phase-III trials and the registration process, which will cost some $300 million.
The valuations and milestone payments will be highly attractive if the results in phase-IIa studies are promising, said Jasti.
“If SUVN-502 is out-licensed now, we may get an upfront payment of some $30 million and if we out-license it after successful phase-IIa studies, we may get $130 million or so as upfront payment, (and) some $300 million over the period of trials and royalties in double-digit percentages once the drug hits the market,” he added.
On Tuesday, shares of Suven gained 0.38% to close at Rs26.60 each on the Bombay Stock Exchange (BSE), whose benchmark index gained 0.11% to close at 17,050 points. The scrip reported a year’s high price of Rs37.40 and low of Rs9.40 on BSE.
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First Published: Tue, Nov 17 2009. 10 06 PM IST