New Hope for HCV
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New life for hepatitis C treatment
Friday, September 12, 2008 | Modified: Tuesday, September 16, 2008
Sara Hall and Mike Catelani have come a long way since Tacere Therapeutics Inc.’s early days, sitting at Starbucks formulating their company.
The two executives rescued a potential treatment for the hepatitis C virus from their former company when it shut down U.S. operations in 2006.
Today, they are benefiting from an agreement with Pfizer Inc. that could take the company to new heights.
Tacere — based in a 1,500-square-foot space in the San Jose BioCenter incubator — has contracts worth $205 million if it meets upcoming milestones.
“If we didn’t start Tacere, (the treatment) basically would have died,” said Catelani, president and chief financial officer. “You get to take a shot like that, and there’s a chance you can make a difference in people’s lives.”
“We definitely bet right,” said Hall, chief executive officer.
Tacere’s treatment is based on RNAi, a mechanism that inhibits genes from transferring information and creating new RNA. Scientists believe that RNAi, which occurs naturally within cells, can be used to silence genes that cause disease.
“The underlying mechanism of RNAi is validated,” said Piper Jaffray senior research analyst Edward Tenthoff. “The therapeutic effect, the drug ability, has some proof of concept, but there are no RNAi drugs approved.”
Tacere’s first-in-class drug, TT-033, is a multitargeted approach focused on the hepatitis C virus, or HCV. TT-033 contains three separate RNAi molecules designed to shut down replication of all strains of the virus. Hall describes this approach as a “cocktail” in one drug.
The blood-borne infectious disease, caused by HCV, affects the liver and is spread by blood-to-blood contact. There is currently no vaccine to prevent the hepatitis C infection.
With only one drug approved to treat it, Hall said patients who contract the disease basically feel like they have the flu for a year. Symptoms can be medically managed, but only about 50 percent of patients can be cleared of the virus through medicines.
An estimated 200 million people worldwide are infected with the chronic condition, Catelani said, representing a $3.5 billion annual market.
Prior to founding Tacere, Hall was the CEO of Benitec Ltd., an Australian company developing RNAi-based therapeutics. Catelani was the company’s CFO. Hall joined Benitec through its acquisition of Sunnyvale-based Avocel Inc., also involved in RNAi. Ultimately, Benitec shut down its U.S. operations, and Tacere’s founders were eventually able to exclusively license the technology.
“We believed the hepatitis C program was of significant value, and we felt if we had a better corporate structure, we could do something with it,” Hall said.
Having unsuccessfully sought venture-capital backing, Tacere was contacted by Pfizer. Tacere entered into a collaboration and license agreement with Pfizer in January for the HCV compound and could receive potential payments of more than $145 million, along with future royalties on sales of the compound. Pfizer is also providing Tacere with funding to complete the necessary studies, as part of the initial phase of collaboration. The collaboration is focused on completing all necessary studies for submission of an investigational new drug application, as well as clinical development and commercialization.
Dr. Curt Scribner, senior vice president of clinical and regulatory affairs with RRD International LLC, is working as a consultant with Tacere. He said it’s one of the best small company-large company collaborations because it combines Tacere’s expertise with Pfizer’s funding to develop TT-033.
“They can only take it so far without a huge infusion of money,” said John Rossi, chairman and professor of the division of molecular biology at City of Hope, a biomedical research center near Los Angeles. “Pfizer has the capacity to make this a real treatment.”
The agreement with Pfizer is for worldwide rights, excluding Asia. Tacere’s initial investment came in June 2007 when it struck a deal with Tokyo’s Oncolys BioPharma to co-develop a treatment for hepatitis C in Asia. In March 2008, the two companies entered into a $60 million deal that will allow Oncolys to acquire Asian rights to TT-033.
With plenty of cash on hand, Catelani said Tacere isn’t seeking funding in the near future.
The company is in the midst of animal toxicology safety studies and later this month will move into studies involving nonhuman primates. It hopes to treat humans before the year’s end.
“If the safety data continues on the same lines, we feel confident in doing a Phase 1,” Hall said.
She added that if Tacere hits the next milestone, it will be capitalized for six years. In the meantime, Catelani said the company is also looking into other products to start developing in its pipeline.
“There are a number of technologies that have the potential to revolutionize medicine — if it works,” said another Tacere co-founder Amit Kumar, a previous venture capitalist and current CEO of biotech company Combi Matrix Corp.
Tacere faces competition in the industry from companies such as Alnylam Pharmaceuticals Inc. and Sirna Therapeutics, which was acquired by Merck & Co. for $1.1 billion in cash, Tenthoff said. However, the analyst said he wasn’t aware of other companies working on RNAi for HCV. He said given the huge treatment opportunity, speed to market and effect are going to be widely important.
“Most people feel pretty comfortable with the mechanism of RNAi,” he said. “The magic, the challenge, the most important thing now is to turn those small interfering RNAs into drugs, and that ain’t easy, and that’s where we’re seeing a lot of money invested.”
At-a-glance
Tacere Therapeutics Inc.
Headquarters: San Jose
CEO: Sara Hall
Employees: 5-6
Year founded: 2006
Phone: 408.960.2205
Web site: www.tacerebio.com
Lisa Sibley can be reached at 408.299.1841 or lsibley@bizjournals.com.
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http://sanjose.bizjournals.com/sanjose/stories
/2008/09/15/focus1.html?b=1221451200^1698814&page=2
