It seems Texas Biotechnology Corp. is sticking to its guns.
Just two months after reporting plans to reacquire full ownership rights to a late-stage cardiovascular drug developed in a limited partnership, the Houston-based company has decided to acquire all assets of the joint venture. (See BioWorld Today, Feb. 3, 2003.)
Texas Biotechnology will pay $10 million to ICOS Corp. in return for the latter's 50 percent interest in ICOS-Texas Biotechnology LP, effectively returning to the former full ownership rights to the endothelin receptor antagonist program. Sitaxsentan, a Phase III compound designed to treat pulmonary arterial hypertension - which showed mixed results in its most recent trial - sits at the head of the table, while the acquisition also includes a backup cardiovascular compound labeled TBC3711.
"Owning 100 percent of the endothelin antagonist program provides us with full freedom and autonomy in our development and licensing plans," Texas Biotechnology President and CEO Bruce Given said in a conference call. "We believe that, while it would cost us some of our cash in the short term, by having ICOS retain no further rights or royalties for this program we have the best opportunity for capturing maximum value for our shareholders."
Bothell, Wash.-based ICOS will receive $4 million at closing, followed by an additional $4 million payment a year later and $2 million more in 18 months, plus interest.
"ICOS did not believe that the partnership should continue the development of the endothelin antagonist," Lacy Fitzpatrick, the director of investor relations at ICOS, told BioWorld Today. "We support Texas Biotechnology's decision to move forward with the development, which is why we entered the agreement."
As a result of the acquisition, Texas Biotechnology updated its full-year financial guidance. The company said it expects its current cash position to last through the end of the third quarter of 2004, instead of through the end of 2004 as previously reported. By the end of the year, Texas Biotechnology said it would have $30 million to $32 million in cash and investments.
To conserve funds, the company plans to control costs outside of its sitaxsentan program while looking to license out its rights in select markets.
"Our strategy includes licensing certain rights to sitaxsentan, preferably excluding North America, in exchange for some mix of up-front cash, payments for development costs, milestones and royalties on sales," Given said. "Depending on the commercial terms of such an agreement, our cash requirements may be substantially reduced."
The company, which said it would like to engage a licensing partner by the end of the year, also plans to rename itself Encysive Pharmaceuticals in the next month, following shareholder approval.
But Texas Biotechnology's immediate sitaxsentan plans include a second pivotal Phase III study of the small molecule beginning in the second quarter. The STRIDE II (sitaxsentan to relieve impaired exercise in pulmonary arterial hypertension) trial will include four arms - 50-mg and 100-mg doses of the drug, placebo and Tracleer (bosentan, the only endothelin antagonist approved to treat pulmonary arterial hypertension).
The once-daily dosage eventually is expected to compete with Tracleer, developed by Allschwil, Switzerland-based Actelion Ltd. and co-promoted by South San Francisco-based Genentech Inc. The FDA approved Tracleer in late 2001. (See BioWorld Today, Nov. 26, 2001.)
"We believe the data generated from this trial can help differentiate the profile of sitaxsentan compared to bosentan in an identical patient population, which will help support marketing upon approval," Given said.
The trial's primary endpoint will measure the drug's effect on a six-minute walk.
Top-line results of STRIDE I, a Phase IIb/III trial reported last fall, showed that sitaxsentan met its primary endpoint at a higher dose, though a lower dose failed to achieve statistical significance. But the higher dose is more associated with liver abnormalities previously recognized as complications related to the endothelin antagonist class of drugs.
The 178-patient trial randomized participants to sitaxsentan 100 mg, sitaxsentan 300 mg or placebo treatment once a day. The 300-mg dose group met the trial's primary endpoint of change in percent of predicted peak VO2 - a measure of endurance - from baseline to week 12, compared with placebo treatment (7 percent relative improvement). (See BioWorld Today, Oct. 22, 2002.)
The trial was an initial focus of the joint venture, formed nearly three years ago as a 50-50 limited partnership to develop endothelin receptor antagonists. The deal included a $2 million up-front payment to Texas Biotechnology. (See BioWorld Today, June 7, 2000.)
Through 2002, Given said the limited partnership spent more than $47 million in its development efforts, of which ICOS has contributed more than $25 million.
Texas Biotechnology already has one product on the market, Argatroban, sold by London-based GlaxoSmithKline plc to treat heparin-induced thrombocytopenia.
Elsewhere in its pipeline is bimosiamose, a selectin antagonist to treat pediatric asthma being developed through Texas Biotechnology's European subsidiary, Revotar Biopharmaceuticals AG. Another compound, TBC-4746, is a VLA-4 antagonist being developed in partnership with Kenilworth, N.J.-based Schering-Plough Corp. as an oral treatment for adult asthma.
Outside of the dissolution of the Texas Biotechnology partnership, ICOS is focused on the European launch of Cialis (tadalafil). A U.S. regulatory decision on the erectile dysfunction treatment, developed through a joint venture with Indianapolis-based Eli Lilly and Co., is expected in the second half of this year.
The pipeline at ICOS also includes a number of Phase II development programs. Its IC747 candidate is designed to treat moderate to severe psoriasis. RTX is being developed to treat interstitial cystitis. IC14, a monoclonal antibody designed to treat sepsis by selectively binding to the CD14 receptors on white blood cells, remains in Phase II studies. Another candidate, IC485, has completed a Phase I study in chronic obstructive pulmonary disease and is expected to move into Phase II later this year, Fitzpatrick said.
Texas Biotechnology's stock (NASDAQ:TXBI) gained 26 cents, or 18 percent, Wednesday to close at $1.71, while ICOS's shares (NASDAQ:ICOS) gained 83 cents to close at $25.80.