Clinical Trial Results
Rumor Mill: Pfizer Buying MediGene?
The German based, MediGene hit a 52 week high yesterday on rumors that they are in discussions with the drug giant Pfizer. MediGene is just the latest of half a dozen companies mentioned in the same sentence as Pfizer in the last few months (others include Biogen, Shire, King and NicOx).
In the past year, many analysts have urged Pfizer to consider buying a midsized drug maker (+$10B deal) but pfizer has been reluctant to take the advice, preferring its many shots on goal strategy demonstrated by the acquisition of Coley ($164M), Encysive ($195M), Serenex and CovX (undisclosed amounts) in the last six months alone.
Is MediGene their next target? Not according to CEO, Peter Heinrich, who mentioned to Bloomberg in April that the company was looking for a strategic partner for their phase II, pancreatic cancer drug, EndoTAG-1. Of course, it’s been a whole month since he made that statement and we all know how opinions change when someone waves a giant wad of exit cash in your face.
EndoTAG-1, a projected blockbuster, is the well-known antineoplastic drug paclitaxel, surrounded by liposomes. There is little reason to suspect the modification of delivery will hinder the effectiveness of the drug but the jury is still out. This March the company released impressive interim results of its phase II trial in pancreatic carcinoma.
In the first stage of the 200-patient trial, subjects receive various doses of EndoTAG-1 twice-weekly for 7 weeks plus once-weekly gemcitabine or gemcitabine alone. In the second stage of the trial, patients continued to receive EndoTAG-1 if tumor response was seen. Patients treated with the highest EndoTAG-1 dose had a 30% increase in survival time, compared with the control group, which was sustained for 6 months. Patients who received EndoTAG-1 over a longer period of time also had substantially better survival time and survival rates.
EndoTAG-1 was also shown to have a positive safety profile and to increase patients’ quality of life. Patients on combination therapy of gemcitabine and EndoTAG-1 showed a dose-dependent increase in the median survival time of 8.1, 8.8 and 9.4 months, respectively, for three increasing EndoTAG-1 doses; this compared with 7.2 months median survival in patients on gemcitabine alone. The six-month survival rate also increased dose-dependently, from 63.3 % in patients on gemcitabine only, to 66.1 %, 72.4 %, and 80.7 %, respectively in the three EndoTAG-1plus gemcitabine groups. In the second half of the study, where patients had the option to continue receiving EndoTAG-1 treatment, pateints demonstrated a median survival time of up to 11.5 months.
Full data will be available by 4Q08 and we will know for sure if these results still stand for the larger group of patients and for the full trial duration.
Here comes the wild number speculation on my part. MediGene is currently trading around a market cap of $350M which is nearly what Pfizer paid for both Encysive and Coley combined. If you factor in a +50% premium (MediGene is a hot company, surely someone else is in the bidding), you are now pushing at least a $500M-$600M acquisition.
Ultimately, whether Pfizer buys MediGene or not, I don’t expect it to be the last deal Pfizer makes this year. With Lipitor sales already starting to soften and nothing in the pipeline to replace the revenue, the impending question is: how many <$1B market cap companies do you have to buy to replace $12B+ in sales every year??
(Photo from Redvers on Flickr under a Creative Commons license)
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Tags: acquisition, EndoTAG, EndoTAG-1, M&A, MediGene, paclitaxel, pancreatic cancer, pfizer, phase 2, taxol 
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