ZymoGenetics Furthers Bristol's "Multi-Pronged" Approach To HCV, Sigal Says

R&D President Sigal talks about how the acquisition of ZymoGenetics fits into Bristol's research strategy in his first public comments to investors since March.

A new interferon with an improved tolerability profile over existing drugs will have a role in the treatment of hepatitis C, even if a new class of medicines becomes available, Bristol-Myers Squibb R&D President Elliott Sigal said, explaining the company's acquisition of ZymoGenetics during an investor meeting Sept. 13.

Sigal made his first public comments since Bristol hosted an investor day in March at the Morgan Stanley Global Health Care Conference. Since then, Bristol has filed ipilimumab, a novel cancer immunotherapy, for approval for the treatment of metastatic melanoma, filed Sprycel (dasatinib) for a new indication in first-line chronic myeloid leukemia, released, with partner Pfizer, positive data on the investigational oral factor Xa inhibitor apixaban, and announced plans to acquire ZymoGenetics for $885 million (Also see "From HCV Partner To Acquirer, BMS Makes $885 M Offer for ZymoGenetics" - Pink Sheet, 7 Sep, 2010.).

While Bristol's HCV pipeline has been in the shadows behind oncology and diabetes, the company has several HCV drugs in mid- and early-stage development. Bristol's plans to acquire its Seattle-based partner for a pegylated interferon lambda turns the spotlight on the company's hepatitis C efforts. Bristol moved in to acquire its partner after the two announced that a Phase IIb trial for interferon lambda completed enrollment of 570 patients early and that results would come sooner, in the first quarter of 2011.

"When we saw the opportunity and science emerging in hepatitis C, we took the learnings and lessons from [HIV] and wanted to go after a multi-pronged approach," Sigal said. While Bristol isn't currently a player in the HCV space, the company does have a heritage in virology with drugs like Sustiva for HIV and Baraclude for hepatitis B.

Interferons, including Roche's Pegasys (peginterferon alfa-2a) and Merck's Pegintron (peginterferon-alfa-2b), currently are the backbone of standard of care, but have flu-like side effects. Newer, first-generation protease inhibitors like Vertex Pharmaceuticals' telaprevir and Merck's boceprevir are moving into regulatory review, but most likely will be used in combination with interferons. Eliminating interferon in favor of some combination of oral small molecules ultimately may work out, Sigal conceded.

"But which case will pan out is not clear, and therefore our multi-pronged approach [includes] a superior interferon," he said. Bristol plans to present Phase IIa data on interferon lambda at the American Association for the Study of Liver Diseases meeting in Boston Oct. 31- Nov. 2, he added. The drug is expected to have a better tolerability profile because the body has fewer lambda interferon receptors compared to alpha interferon receptors, so the treatment is more targeted, mainly to the liver.

Beyond interferon lambda, Bristol has two other drugs in Phase II development for HCV, a NS5A inhibitor and NS3 protease inhibitor. The company is studying the two separately and in combination.

The ZymoGenetics deal also would give Bristol an interleukin-21 drug, which is in Phase IIb development for metastatic melanoma, a therapeutic area that is already familiar to Bristol.

"IL-21 is in early clinical but we imagine that that could be combined with other approaches like ipilimumab in melanoma," Sigal said.

Sigal indicated that the company is pleased with its decision several years ago to rely increasingly on external R&D for help in building its pipeline. Bristol's "string of pearls" strategy, with a focus on acquiring outside assets, is pushing the company into a period of research productivity, he said.

"I'm pleased that we, for a variety of reasons, held our internal discovery flat dating back seven or eight years ago," he added. "That forced the whole organization to go outside for our desired output, and that does not restrict you, therefore, to the innovation within your four walls."

Bristol's strategy of honing its focus on pharmaceuticals, and particularly drugs that address areas of high unmet medical need, is quite a different tact than the diversified approach many other large pharmas are taking to get through a difficult period of patent expirations. Bristol is set to lose its blockbuster blood thinner Plavix (clopidogrel) in 2011.

"We saw the external challenges coming years ago and the focus on unmet medical needs and the focus on pharma allows us to do what I think can be done, and that is to become an outlier in an industry where the norms may be distressing, [but] the outlier possibility of making great business and great medicines is still there," Sigal closed.

The anticoagulant apixaban is a potential blockbuster in the making that eventually could help Bristol to make up some of the shortfall in Plavix. Bristol/Pfizer's best chance for approval of apixaban is based on data testing it against warfarin, which will be reported in 2011. However, the companies are weighing an earlier filing after releasing positive data from a clinical trial that showed a benefit compared to aspirin in preventing stroke in atrial fibrillation patients who are not able to take warfarin (Also see "Apixaban Impresses At ESC, Leading To Speculation About An Early Filing" - Pink Sheet, 31 Aug, 2010.).

-Jessica Merrill ([email protected])