Eyetech execs get a do-over
Ophthotech Raises $36 Million; In-Licenses Two Compounds for Macular Degeneration
Wet AMD
The Ophthotech Board will consist of: Henry Simon (SV Life Sciences and former Chairman of the Board of Eyetech Pharmaceuticals, Inc. (”Eyetech”), Axel Bolte (HBM BioVentures), Thomas Dyrberg, M.D., Ph.D. (Novo A/S), David R. Guyer, M.D. (former CEO and co-founder of Eyetech, who will also serve as Ophthotech’s Chairman of the Board), and Samir Patel, M.D. (President and CEO of Ophthotech and former co-founder of Eyetech). The management team consists of former senior Eyetech personnel led by Chief Executive Officer, Samir Patel, M.D. Eyetech developed and commercialized Macugen, the first anti-VEGF therapy for the eye.
Eyetech, formerly an independent biotech with an aptamer targeting VEGF (pegaptinib, Macugen) that is used to treat wet AMD, was acquired by OSI Pharmaceuticals not long ago. The acquisition price was below the IPO price (details here). It was a new therapeutic area for OSI, and it didn’t work out. Despite the assistance from Pfizer’s ophthalmic salesforce, Macugen couldn’t stand up to pressure from Genentech’s anti-VEGF monoclonal antibodies, Lucentis and Avastin. OSI is now divesting its eye business. As part of the divestiture, OSI has licensed its apatemer targeting PDGF (a related angiogenic peptide) to newly formed Ophthotech. Ophthotech has also licensed development and marketing rights to Archemix’s aptamer targeting the C5 component of complement (an inflammation factor). As you’ll read, Ophthotech is staffed largely by former Eyetech execs. It’s a chance for them to do it all over again. Perhaps this time around they will not sell out the early public-market investors by dumping the firm below its IPO price, while reserving a tidy sum for themselves.
August 16th, 2007 at 4:02 pm
[...] UPDATE REDUX: Over at Pharma’s Cutting Edge, Fred Cohen notes what I didn’t have time to, which is that Ophthotech essentially amounts to a do-over for the architects of Eyetech’s failure. Check it out. For more stories on VentureBeat Life Sciences, click here.Tagged biotechnology, cardiovascular, co:Archemix, co:BioFX Laboratories, co:Eyetech Pharmaceuticals, co:FoldRx, co:Glide Pharma, co:Nanosphere, co:Ophthotech, co:Pevion Biotech, co:Reliant Pharmaceuticals, co:Restoration Robotics, co:SurModics, cystic fibrosis, Cystic Fibrosis Foundation, deal, drug formulations, hair transplants, inv:Alloy Ventures, inv:Bachem Holding, inv:BB Biotech Ventures II, inv:BZ Bank Aktiengesellschaft, inv:CC Private Equity Partners, inv:HBM BioVentures, inv:Interwest Partners, inv:Novo A/S, inv:Oxford Capital Partners, inv:Oxford Technology 4 VCT, inv:sutter hill ventures, inv:SV Life Sciences, IPO, M&A, macular degeneration, medical devices, molecular diagnostics, needle free injections, specialty pharmaceuticals, vaccines VentureBeat Community [...]
August 16th, 2007 at 4:12 pm
Great post. I’d be curious to know whether you think Eyetech failed primarily because of management and execution errors, as your post seems to imply, or whether Guyer et al. just backed the wrong horse with Macugen. If the latter, was the problem that they went with an isoform-specific VEGF inhibitor (one that blocked VEGF-165 instead of a variety of isoforms, which is what Avastin and Lucentis do), or that they went the untested aptamer route, which potentially robbed Macugen of the immune-stimulating properties that an antibody or antibody fragment might have? Either way, I don’t suppose it suggests much for the future of Ophthotech.
Btw, I just credited you with this nice insight over at VentureBeat Life Sciences; see http://venturebeat.com/2007/08/13/life-sciences-briefing-monday-aug-13-2007/.
August 16th, 2007 at 6:12 pm
Thanks. Those are great questions that I’m sure everyone interested in aptamers wants answers too, but I wouldn’t even hazard a guess to the technical questions myself. Answering that question beyond pure speculation requires a detailed understanding about what happens to the various drugs in the human retina at the VEGF receptor (i.e. the local PK-PD relationship). I don’t possess this level of understanding. Once this is known, you should be able to draw inferences about other factors, such as isoform specificity, that would provide the differential efficacy explanation.
I wasn’t faulting the management team for its planning and execution; I fault them for the way they treated the company’s investors–selling out the company below IPO value, while enriching themselves. If the IPO investors in a one-horse biotech take a hit, so too should management. But, in this case, I think management should have held out for a better deal or stayed independent and let the Macugen ship sail or sink on its own. Instead, management got out unscathed financially and are now allowed a “do-over,” with the an improved pipeline and without the “burden” of trying to sell Macugen. Eyetech’s, now Ophthtech’s mangers, are clearly no fools. To see the fools, you need to visit OSI.
August 16th, 2007 at 10:34 pm
[...] I didn’t write any of this at the time, however, and in the meantime several others have pointed out a number of interesting facts about Ophthotech’s emergence, not to mention some eerie parallels. Fred Cohen at Pharma’s Cutting Edge offered this acerbic interpretation: OSI is now divesting its eye business. As part of the divestiture, OSI has licensed its apatemer targeting PDGF (a related angiogenic peptide) to newly formed Ophthotech. Ophthotech has also licensed development and marketing rights to Archemix’s aptamer targeting the C5 component of complement (an inflammation factor). As you’ll read, Ophthotech is staffed largely by former Eyetech execs. It’s a chance for them to do it all over again. Perhaps this time around they will not sell out the early public-market investors by dumping the firm below its IPO price, while reserving a tidy sum for themselves. [...]