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Alizyme's Cetilistat Now Has Weighty Expectations April 23, 2008 Alizyme’s cetilistat now has weighty expectations Lisa Urquhart The decision by Alizyme to suspend further development of renzapride, its phase III treatment for irritable bowel syndrome with constipation, not only denies the group much needed income from a potential licensing deal, but once again turns the spotlight firmly back on its weight loss drug cetilistat. Today’s news that renzapride failed to meet three secondary endpoints of relieving abdominal pain, bowel problems and bloating caused the shares to plunge by 27% to 28¼p, adding to a 67% slide over the last 12 months. With renzapride gone, the group is left with cetilistat as its most valuable product, a drug that Alizyme has failed to find a partner for in over two years of trying. Cetilistat, which is worth $644m according to the EvaluatePharma NPV Analyzer, has been stuck at phase II for over two years, as the company has tried to sign a licensing deal with a US or European partner to take it into the large and costly phase III trials that Alizyme, with its low cash levels, is in no position to go ahead and start. Jacob Plieth, pharma analyst at Edison Investment Research, believes that the delay in getting a partner for the drug has been firmly down to price. “There is not an issue whether they can get a deal, it’s about what their expectations are versus the market's,” he said. Crucial data Price aside, some believe that the hold-up is because potential licensors are waiting on longer term data from Japanese partner Takeda. So far Alizyme has only tested the drug for 12 weeks in patients. In contrast the Osaka-based company is conducting a six month trial of the drug. What any partner will be looking for is if weight loss using cetilistat is sustainable and how the drug measures up in terms of tolerability. Like other lipase inhibitors that prevent the absorption of fat in the gut, cetilistat can cause unpleasant gastric problems including faecal urgency and oily stools. But as to when this vital data may come to light is another thorny issue for Alizyme, as Takeda recently said that it had currently had no plans to report the findings from the study. More worrying is that Takeda has so far shown no signs that it is interested in taking up the world-wide rights to the drug. Time equals money With every month that passes without a deal to take the drug forward the market opportunity for celistat diminishes. Rival lipase inhibitor Xenical is already being sold over the counter as Alli and today GlaxoSmithKline reported sales of £9m for the drug in the first quarter of the year. Additionally, many in the space are getting very excited by Lorcaserin, the drug from Arena Pharmaceuticals that has shown better efficacy than cetilistat and because it works in a different way has avoided some of the tolerability issues of cetlistat. The drug is also two years further on its development path and could reach the market by 2010. With Celistat effectively parked for now the group has few other options for growth. Its other late-stage product Colal-Pred, for ulcerative colitis, last year signed what many considered a disappointing licensing deal with Promethius Labs and its next most advanced product is only in phase II. The waiting game Alizyme, which last month raised £10m from a rights issue, has said that it could go out and do acquisitions. But using this as a strategy to drive much needed near-term growth, seems a little optimistic, given that the money was initially raised to help it pay back £9m of debt. Investec Securities has estimated that only £3.9m of the £10m will be left for 2008, even after the group’s decision to slash its burn rate from almost £30m in 2007 to closer to £5m this year, by the bank's calculations. This small-looking sum is unlikely to be able to buy the group much, as even the price of early stage assets has been rising as both big and mid-size pharma look to license earlier and earlier products. Also, with Alizyme practically in suspended animation with regards to R&D in an effort to keep its costs lower, even if it did acquire an asset, it could struggle to develop its new prize. So, with little else on the horizon to raise the shares weary investors who have already waited several years for a licensing partner for cetilistat, will now have to hunker down and prepare to wait a little bit longer. More from Evaluate Vantage Evaluate HQ 44-(0)20-7377-0800 Evaluate Americas +1-617-573-9450 Evaluate APAC +81-(0)80-1164-4754 © Copyright 2021 Evaluate Ltd..
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