Managing Editor

Pfizer Inc. continues cleaning out its attic and The Medicines Co. was more than happy to snap up that cool looking but almost forgotten compound over there in the corner - ApoA-I Milano.

The Medicines Co. paid $10 million up front for an exclusive worldwide license for the naturally occurring variant of a protein found in human high-density lipoprotein (HDL) that may be able to reverse atherosclerotic plaque development and reduce the risk of coronary events in patients with acute coronary syndrome.

The heavily back-loaded deal also offers Pfizer potential clinical, regulatory and sales milestones up to a total of $410 million, plus single-digit royalty payments on worldwide net sales of ApoA-I Milano. The Medicines Co. will also pay $7.5 million to third parties.

Pfizer probably won't be bragging about the deal, since it paid $1.3 billion in 2003 to buy Esperion Therapeutics Inc. to acquire the compound. At that point, the drug looked like a near-perfect fit with Pfizer's Lipitor (atorvastatin calcium), which was even then the world's most prescribed agent for reducing low-density lipoprotein (LDL), or the "bad cholesterol." And Esperion - founded by the scientists who helped discover and develop Lipitor - looked like a perfect fit with Pfizer.

Since then Pfizer has done little to advance the drug clinically, but did extensive work on the formulary and manufacturing end, according to The Medicines Co. It will now pick up on the development with both nonclinical and clinical work in 2010 and 2011, followed by Phase II/III trials in 2012 and a Phase III program in 2014, Glenn Sblendorio, executive vice president and chief financial officer, told investors on a conference call.

T. Scott Johnson, vice president of new business ventures and chief medical advisor, explained that ApoA-I Milano is a good candidate to bridge an existing gap in the fight against coronary disease. Great advancements have been made in prevention, and also in treating patients (coronary artery bypass, etc.), but there is still a high risk between those two. He said the subacute stage of treatment, when HDL - the "good cholesterol" - could be beneficial, is the market for ApoA-I Milano.

Johnson called ApoA-I Milano an example of a case in which "genetic mutations have opened a window to disease." It was found in about 45 people from Limone sul Garda, a small village in northern Italy. Carriers of that variant appear to have reduced risk of cardiovascular disease. Patented by the University of Milan and Pharmacia, ApoA-I Milano was licensed to Esperion Therapeutics.

In preclinical models, ApoA-I Milano was shown to rapidly remove excess cholesterol from artery walls, stabilizing and regressing atherosclerotic plaque. A Phase I-II study in 36 patients showed statistically significant reductions on coronary plaque volume by 4.2 percent in six weeks, findings that were published in the Journal of the American Medical Association.

Joseph P. Schwartz, an analyst with Leerink Swann, praised the deal, writing in a note that ApoA-1 Milano "could be the killer app, if commercialization challenges can be overcome." The compound's composition-of-matter patent only lasts until 2016, "but we expect at least 10 years of market exclusivity to be provided by biosimilar legislation in the U.S. Practical challenges of replicating complex proteins should hold off generic competition further," he noted.

The Medicines Co. is not alone in the effort to commercialize ApoA-1 Milano. Resverlogix Corp., of Calgary, Alberta, has lead cardiovascular drug, RVX-208, a small molecule designed to facilitate endogenous ApoA-I production, in two parallel Phase II trials, and SemBioSys Genetics Inc., also of Calgary, is developing an Apo-AI Milano candidate.

Wall Street reacted neutrally to The Medicines Co. deal, with shares (NASDAQ:MDCO) rising 26 cents to close at $8.80.