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GTX: FILLING THE GAP
A recommendation to Cure on Gastrex drug license
opportunities
YBPS Marketing Case Competition
Richard Hernandez, MBA
Liying Jin, MS Statistics
Selina Tirtajana, MPH
Mike Ran Zou, PhD Pathology
* Candidates
Biotechnology & Pharmaceutical Solutions
PROBLEM STATEMENT
IBD is a chronic inflammation of the gastrointestinal
tract. Two major types of IBD are Crohn’s Disease
(CD) and Ulcerative Colitis (UC) – which affect
different parts of the GI tract.
Currently, there are unmet needs in IBD therapy
and Cure has been presented with licensing
opportunities (GTX-001 & GTX-002) from Gastrex
that can potentially fulfill these needs.
Based on pre-clinical studies results and market
analysis of these two drugs, we will provide
recommendation for Cure.
IBD PATH PHYSIOLOGYAntigen
GI Flora
1
1Antigen Processing & Presentation, Activation of Macrophages
Activated
Macrophage
Activated
T-Cell
TNFα IFNγTh1 Cell
Th2 Cell
IL-4IL-12
IFNγ
IL-10
Intestinal Lumen
2
2
Antigen Recognition & Activation of CD4+T Cell
Recruitment, Migration, and Adhesion
5
Generation of
Th1/Th2 Response3
3
Production of Proinflammatory Cytokines
4
4
5
Macrophage
Macrophage
Monocytes
Epithelium
Neutrophils
TNFα
IFNγ
IL-10
PREVALENCE ESTIMATES OF CD & UC IN
2008479,000
88,000
23,000 35,000
120,00090,000
26,000 19,000
US UK Italy Spain France Germany Japan China
CD Prevalence Estimate
525,000
148,000
70,00044,500
80,000100,000 96,000
154,000
US UK Italy Spain France Germany Japan China
UC Prevalence Estimate
GTX-001 SHOWS PROMISING RESULTS IN
PRE-CLINICAL STUDIES
GTX-001 is a Monoclonal Antibody that targets VLA-1
Blocks immune cell trafficking/activation
Pre-clinical (animal studies) results
Improved inflammation score within 4-6 wks
Dose of 2mg/kg intravenously (IV) every 48 hours
Drug tolerated up to 6 mg/kg
Good substitute of existing biologicsin the market
VLA-1
GTX-001
GTX-002 SHOWS PROMISING RESULTS IN
PRE-CLINICAL STUDIES
GTX-002 is a small molecule compound used to induce T-cell death by targeting IκB Kinase
Effectiveness confirmed by cell-based assays
Pre-clinical (animal studies) results
Remodeling of GI commensal flora indicates altered pathology
Susceptibility to bacterial infection demonstrates immunosuppresion
Improved clinical scores when used in combination with 5-ASA and/or steroids
Good remission, but not induction, agent
Dosage above threshold limit causes liver and kidney toxicity
50 mg/kg orally or 5 mg/kg IV
GTX-002
cell
death
Type of treatment Pros & Cons
5-ASA (Asacol, Lialda,
Pentasa, Colazal,
Sulfasalazine)
-Reliable & effective for mild CD/UC cases
-Relatively affordable
-Used to maintain remission in moderate cases (but
lack efficacy in more severe cases)
Steroids (Budesonide,
Prednisone,
Methylprednisolone)
-Effective for induction of remission
-Cheap
-Long term side effects make it a poor agent to
maintain remission
Immunomodulators
(Azathioprine, 6-MP)
-Effective maintenance therapy for moderate to severe
cases (up to 60% response rate)
-Slow onset & high rate of toxicity
Biologics (Infliximab,
Adalimumab,
Natalizumab,
Certolizumab)
-Effective in severe cases
-Expensive, relatively inconvenient to administer
-Few clinical data in UC cases
-Patients don’t respond / lose response to TNF-α
inhibitor over time.
CURRENT TREATMENT
UNMET NEEDS IN IBD THERAPY
Mild
(5-ASA)
Moderate
(5-ASA, Steroids,
IM)
Severe
(Steroids, IM,
Biologics)
Crohn’s Disease/Ulcerative Colitis
NONE 1. Induction agent safer than steroid
2. Remission agent that is more effective
than 5-ASA and/or has faster onset &
safer than IM
3. Substitute to anti-TNF with safer
profile
4. Biologics with better sustained remission rates
Mild IBD cases are well served by 5-ASA
Severe patients failed to respond to anti-TNF therapy, which
dominates the current market to treat moderate to severe IBD
5-ASA
5-ASA
Steroid
5-ASAMild
Moderate
Severe
Steroid
IM1
Biologic
Biologic2
Treatment
Refractory
Treatment
Refractory
No
TreatmentNo
Treatment
1 2 3 4
5 6
Maintenance
Induction
Maintenance
Induction
5-ASA
5-ASA
Steroid
5-ASA
Steroid
IM1
Biologic
Biologic2
5-ASA
5-ASA
Steroid
5-ASA
Steroid
IM1
Biologic
Biologic2
Patient Segments in Crohn’s Disease
POTENTIAL TARGET MARKET FOR GTX001
AND GTX002
Choice of market segments based on
pre-clinical findings
GTX002
GTX001
DRUG VALUATION ON THE MARKET
Assess net value at the present day by discounting cash flow of future revenue and subtracting license fees and other associated payouts.
GTX-001 in the moderate to severe market is sufficient to provide positive NPV
Generic biologics are not competitive
Sensitivity analysis shows that NPV is robust across a spread of various growth rates.
GTX-002 fails to meet a positive NPV
Growth Rate NPV (discount rate
at 11%)
-1% -16.38
-0.9% 0
0% 105.98
0.6% 188.97
3% 609.27
5% 1099.33
Growth Rate NPV (discount rate
at 9%)
-1.8% 0
-0.9% 118.00
0% 283.04
1% 476.03
3% 965.43
5% 1633.84
RECOMMENDATION: FILL THE GAP!
Purchase license for GTX-001
There is a demonstrated market need
Added advantage of being a biologic in the US because
barriers of entry
NPV is positive and therefore a profitable drug
Do not purchase license for GTX-002 under the
current agreements.
Market is well served by other available agents
56% of market share is required in order to break even
in the licensing investment
Consider renegotiating license fee or changing payout
structure to delay payment
Q&A
CITATION
Title slide image
http://www.scumdoctor.com/images/How-Much-Does-
Enbrel-Suppress-The-Immune-System.jpg
Biologics cannot have generic synthetic
http://www.businessweek.com/bwdaily/dnflash/content/
mar2007/db20070314_175878.htm
Decision tree for pharmaceutical acquisition.
http://www.springerlink.com/content/j28414r31p013
331/fulltext.pdf
Sands, Bruce E. Therapy of Inflammatory Bowel
Disease, GASTROENTEROLOGY 2000;118:S68–
S82
INTERNATIONAL MARKET FOR CD?
Prevalence Market Share Potential Market Share
US54%
UK10%
Italy3%
Spain4%
France14%
Germany10%
Japan3%
China2%
US70%
UK8%
Italy1%
Spain2%
France13%
Germany6%
Japan0%
China0%
INTERNATIONAL MARKET FOR UC?
Prevalence Market Share Potential Market Share
US63%
UK16%
Italy4%
Spain2%
France5%
Germany6%
Japan3%
China1%
US43%
UK12%
Italy6%Spain
4%
France6%
Germany8%
Japan8%
China13%