GLG News by Keith Berman, MPH, MBA

Implications: Not surprisingly, everything tried thus far to slow the relentless progression of Alzheimer's disease has failed.  But if strong efficacy signals from two pilot studies and a recently completed Phase II trial of human immunoglobulin (IVIg) are confirmed in a Phase III trial scheduled to start next month, that string of failures will be coming to an abrupt end.  The two NIH-supported pivotal trials will answer two questions:  (1) is an age-related failure of natural antibody-mediated immunity important in the development of Alzheimer's disease, and (2) can this disease process be slowed by restoring therapeutic levels of antibodies that some older people no longer make enough of?  With what we know about the role of beta-amyloid protein in Alzheimer's, and have learned from studies testing anti-beta amyloid monoclonal antibodies, and have seen in those three small IVIg trials , I wouldn't bet on another failure this time around.

Analysis: These pivotal IVIg/Alzheimer's studies for Baxter and other IVIg manufacturers -- CSL, Talecris, Grifols, Octapharma, Biotest, Kedrion and others -- can play out in unexpected ways over the next several years.  Alzheimer's is no ordinary disease.  And this is no ordinary drug development story. 

Implications: The efficacy of intravenous immunoglobulin (IVIg) for treatment of CIDP was documented many years ago.  Neurologists have ordered IVIg for years to treat this debilitating disorder, particularly for patients who fail therapy with corticosteroids or other immunosuppressive drugs. Talecris Biotherapeutics' elaborate Phase III crossover study (published earlier this year in The Lancet) proved unequivocally that chronic treatment with Talecris' Gamunex IVIg yields better long-term patient disability scores than placebo treatment.

Analysis: In the coming months, the question is to what extent this FDA approval translates into additional demand both for Gamunex and competing IVIg products from Baxter Healthcare, CSL, Octapharma and Grifols.

Implications: After abandoning a 2007 IPO, Talecris majority owner Cerberus Capital is now reported to be pursuing negotiations to sell the $1.2 billion plasma products firm. Talecris' valuation will necessarily involve projections of worldwide market demand for intravenous immunoglobulin (IVIg), the industry's most important product.

Analysis:

Talecris manufactures IVIg, human albumin, alpha-1 proteinase inhibitor and factor VIII.  Together with Baxter Healthcare and the Australian conglomerate CSL, Talecris is one the three leading U.S. suppliers of plasma products.  Year-over-year sales grew nearly 10% in 2007, with a robust $265 million in EBITDA.

Cerberus may be looking at an outright sale of the company to add to its return on investment and generate needed cash.  According to a report in the Financial Times, it may be in discussions with CSL, a logical suitor to manage this kind of complex and highly regulated operation.  CSL successfully acquired and integrated Aventis Behring in 2004.

Talecris is currently working its way through a significant production hiccup, but this issue is readily resolvable.  Future revenues and profitability will have much to do with the future direction of pricing and demand in the all-important U.S. and international IVIg market.

Implications: If a report in the Financial Times is credible, the already consolidating plasma products industry could render down to even fewer players in the near future with the sale of Talecris to a major competitor. The value of the company will be strongly influenced by the direction in demand for its industry's leading product:  intravenous immunoglobulin (IVIg).

Analysis: Talecris is among the three leading U.S. suppliers of plasma products, most prominently IVIg, human albumin, alpha-1 proteinase inhibitor and factor VIII.  The other two dominant entities are Baxter Healthcare and the Australian conglomerate CSL.  Talecris' revenues grew nearly 10% between 2006 and 2007 to $1.2 billion, generating nearly $265 million in EBITDA last year.

Having pulled back an IPO offering in last year's unfavorable market, majority owner Cerberus Capital may be looking at an outright sale of the company to add to its return on investment and generate needed cash.

While Talecris is currently working its way through a significant production hiccup, it is temporary.  The potential for future revenue growth and profitability for this operation has much to do with the future direction of the all-important U.S. and international IVIg market.

Implications: The FDA -- likely with encouragement of King Pharmaceuticals -- has ordered ZymoGenetics to cease dissemination of materials that cite "a significantly lower incidence of antibody formation compared to the commercially available bovine thrombin product [Thrombin-JMI]." "This statement is false or misleading because it suggests that Recothrom is safer than the bovine thrombin product due to a lower incidence of antibody formation," while in fact "the incidences of pre-specified adverse events were similar between Recothrom and bovine thrombin" in a head-to-head clinical trial conducted by ZymoGenetics. Shortly after the U.S. approval of Recothrom was announced in January, I posted an analysis that concluded as follows:  "While ZymoGenetics deserves kudos for crossing the FDA finish line, its selling proposition is flawed." One of those flaws was the company's fast and loose promotion of this antibody safety claim.  The FDA's action comes as no surprise.

Analysis: In my Jan. 18 analysis just after Recothrom was approved, I said "ZymoGenetics will do its level best to emulate the achievements of all the other new recombinant versions of plasma-derived therapeutic proteins:  knock them down or entirely out of the market with a superior safety claim."

The company has aggressively pushed the point that Recothrom demonstrated much lower immunogenicity than Thrombin-JMI in Phase III human testing. 

Unfortunately, there wasn't a shred of evidence that antibodies generated against bovine proteins in Thrombin-JMI translate into clinical complications.   They might, but not in a broad surgical patient population like the one enrolled in the pivotal Recothrom trial.

ZymoGenetics' star safety claim for Recothrom has just been thrown out of the game.  To continue the metaphor, remaining safety arguments -- lack of a black box warning or a warning related to potential transmission of an infectious agent -- are benchwarmers by comparison.

Implications: Three presentations at this week's AAN meeting in Chicago are adding in a big way to accumulating evidence that intravenous immunoglobulin (IVIg) may slow, halt or even PREVENT accumulation of toxic beta-amyloid -- a prime culprit in the development of Alzheimer's disease (AD) in millions of aging individuals. Antibody-binding, serology and preclinical findings powerfully suggest that progression to AD has something to do with a failure to mount an adequate humoral (antibody) immune response to beta-amyloid oligomers, which then deposit in brain tissues.  New lab, PET scan imaging, clinical and lookback study results now offer important new evidence that frequent infusions with low doses of IVIg may restore the "missing link" in immunity and allow the patient's cellular immune function to more effectively kick in and clear the toxic beta-amyloid. Whether monoclonal antibody preparations now in development can mimic an array of natural human antibodies remains an open question.

Analysis: Back in August 2006, Cornell doctors reported encouraging results with IVIg in a small 8-patient AD study, echoing similar findings by a German team. 

A year later, Cornell announced "favorable" outcomes in a 24-subject Phase II trial of Baxter's GAMMAGARD.  Separately, a large lookback study found that non-demented patients who got IVIg for other reasons had an astonishing 42% lower risk for subsequently developing AD and related dementias.

Lab, imaging and clinical findings presented at this week's AAN meeting are adding credibility to the assertion that failure of natural immune-mediated clearance of beta-amyloid oligomers is key to understanding why AD occurs as people age.

Many indicators now suggest a therapeutic role for anti-beta-amyloid antibodies, in early-stage AD possibly even in at-risk individuals.  Answers from Phase III trials are 3 years away.  In the meantime, the temptation for patients and the "worried well" to give IVIg a try will be significant.

Implications: ZymoGenetics exuberantly proclaimed yesterday in a conference call that "we expect RECOTHROM to become the leading thrombin product in the hemostasis field."  The company will test its premise that the U.S. hospital market will (1) abandon or snub three plasma-derived thrombin offerings, and (2) pay a price premium for theoretical safety advantages touted for its recombinant version.  We now have four strong competitors with diverse product forms and selling platforms vying for the $250 million U.S. thrombin market.  Simply put, there isn't enough room for four players to succeed in this atypical market.  As I said in my last update on 12/20, get ready for a bloodbath.  

Analysis: ZymoGenetics will do its level best to emulate the achievements of all the other new recombinant versions of plasma-derived therapeutic proteins:  knock them down or entirely out of the market with a superior safety claim.

This strategy worked beautifully 15 years ago for Baxter and Bayer with their recombinant Factor VIII products for hemophiliacs.  Plasma-based Factor VIII now accounts for just 20% of that market.

Now 115 seasoned ZymoGenetics and Bayer reps will fan out to pitch their own safety story to hospital P & T committees and surgeons:  no theoretical risk of HIV or hepatitis transmission (unlike Omrix/J & J's Evithrom or Baxter's ), and no significant immunogenicity or black box warning (unlike King's Thrombin-JMI).

Such is ZymoGenetics' confidence that the company will go out to hospitals asking for a 20% price premium.

While ZymoGenetics deserves kudos for crossing the FDA finish line, its selling proposition is flawed.  I anticipate disappointments ahead for the company and its investors.

 

Implications: Without major fanfare, Baxter(NYS:BAX) Healthcare has secured FDA approval for a kit combining its proven-safe, pathogen-inactivated human thrombin in combination with Pfizer's(NYS:PFE) popular GELFOAM collagen pad.  The GELFOAM Plus kit will be launched early next year. But for years, Baxter's human plasma-based thrombin has been licensed as a component of its Tisseel VH fibrin sealant used primarily in cardiopulmonary bypass surgeries, and its vFloSeal collagen matrix product favored particularly for hemostasis involving anatomical defects. The long-expected 3-way battle over King Pharmaceutical's lucrative $250 million thrombin business just got more interesting -- and challenging -- for King Pharma (Thrombin-JMI), Johnson & Johnson's Ethicon unit (Evithrom) and ZymoGenetics, which still awaits approval of its touted low-immunogenicity recombinant thrombin product.

Analysis: The Q1 2008 launch of Baxter's convenient new GELFOAM Plus surgical hemostasis kit will importantly alter the competitive landscape for all three stand-alone thrombin products expected to be vying for market share.

Baxter can't sell or promote its human thrombin separately from the 4 x 4-inch collagen pad with which it's packaged.  On the other hand, many surgeons routinely order and use stand-alone thrombin in conjunction with GELFOAM, Surgifoam, Instat, Avitene or other hemostatic pad.

Opportunities for Baxter to fold GELFOAM Plus into package rebate deals could rival Ethicon's ability to leverage its broad product line with the newly launched Evithrom human thrombin (manufactured by Omrix Biopharmaceuticals).  However, some hospitals may prefer to opt for the flexibility of ordering and separately stocking a stand-alone thrombin and the assorted hemostatic pads and sponges.

For a decade, U.S. surgical teams have had just one choice of topical thrombin:  King's highly popular bovine plasma-sourced Thrombin-JMI.
Now we have the prospect of four competitors vying for the $250 million thrombin market. 

Baxter's entry creates yet another big reason that this thrombin battle is shaping up to be a bloodbath, especially for weaker hands. 

Implications: Bad news for Bayer's Trasylol (bovine aprotinin) has come in waves.  In 2006, a large retrospective review identified a two-fold higher risk of kidney failure and heart failure, and much higher risks of heart attack and stroke in CABG surgery patients given Trasylol versus those not given the drug. Then a February 2007 observational study, involving more than 4,300 cardiac surgery patients in 69 hospitals, found that Trasylol (but not two other antifibrinolytic drug) was associated with a nearly 50% increased risk of death versus no treatment, after adjusting for other mortality risk factors. And on October 19, the FDA disclosed that it has been notified by study safety monitors of a higher death rate in cardiac surgery patients given Trasylol than two other antifibrinolytic drugs (aminocaproic acid and tranexamic acid).  From U.S. approval, it took some 15 years for these extraordinarily serious and diverse problems to be brought to light.

Analysis: Bayer has aggressively marketed Trasylol as a blood-sparing agent since the early 1990s.  The treatment goal in cardiac surgery patients is to reduce blood loss and the need for transfusions, and the drug has been repeatedly shown to do this job very well.

Trasylol sales climbed nicely between 2003 through 2005:  from roughly 155 million euros ($197 MM) to more than 230 million euros ($293 million).  In December 2005, Bayer projected a worldwide market of at least 500 million euros, and disclosed that it was planning to develop uses in other blood surgeries -- notably hip replacement and spinal surgery.  The company announced that a recombinant version was in the works, with an NDA targeted for 2009.

Given the seriousness and magnitude of the adverse findings reported over the last two years, the drug's relatively modest therapeutic benefit, and the availability of apparently safer (not to mention much cheaper) alternatives, some observers may find it difficult to understand why the FDA has allowed Trasylol to remain on the market.

A reasonable person would expect to see the product withdrawn from commercial sale within days or weeks.  Meanwhile, cardiac teams and hospital P&T committees -- concerned about patient outcomes and litigation risk -- are abandoning this problematic drug.

Implications: As billions of investment dollars over the last 20 years can attest, there is an important need for an effective temporary non-blood oxygen carrier, especially for severe bleeders facing an extended delay to reach the hospital.   Northfield's pivotal trial didn't manage to document "noninferiority" of its PolyHeme product in 714 intent-to-treat subjects, but the mortality gap narrowed substantially in the 586 subjects who met all enrollment criteria and got the right products. The company has asked independent reviewers to see if an imbalance in underlying risk factors could explain an 11:3 skew in heart attacks favoring the saline-and-blood control group. A plan to seek a "priority review" for its BLA reflects Northfield's confidence that the FDA will see the implied value of PolyHeme for the long transit population that can't be sustained with saline alone.

Analysis: With less than $40 million in cash and little prospect of attempting another complex, lengthy clinical trial, Northfield has little choice but to lay its best case on the table and play out its hand with the FDA. 

The company says it will work to convince the FDA that PolyHeme -- even if not quite as safe as saline and blood in the short-haul urban transit setting -- can and will save lives in rural and remote accident and battlefield situations.

Interestingly, the U.S. Navy is making much the same argument in its thus far fruitless efforts to convince the FDA to approve a Phase III urban trauma trial of Biopure's investigational bovine hemoglobin product.

Shell-shocked investors remain largely on the sidelines after the release of disappointing top line data late last year, but, in its quest for one of the Holy Grails of medicine, Northfield has a remarkable history of shaking off adversity. 

Implications: For over 2 million Americans afflicted with mild and moderate Alzheimer's disease, there is nothing available to stop or meaningfully slow the progression of this brain-ravaging disease.  the sticky beta-amyloid peptide that is concentrated in plaques has been implicated for years.  Then a group at Cornell documented stabilization or improvement in most subjects in a small open-label study of IVIg.  This coincided with large elevations in beta-amyloid levels in the circulation. Yesterday Baxter announced "favorable" results after preliminary review of Phase II trial data involving 24 subjects infused with it's Gammagard IVIg products or a placebo solution.  Suddenly the wheels are in motion on a much larger Phase III study sponsored by Baxter and the U.S. National Institute on Aging.  That trial is set to begin in early 2008. A host of issues must be addressed if IVIg proves effective.  How effective? in whom?  And what about product supply?

Analysis: While biopharma companies -- Lilly, Biogen, Elan, Wyeth and others -- work on humanized monoclonal antibodies targeting beta-amyloid, IVIg has jumped out ahead of the field. 

Even before Phase III study data answer whether and who can benefit from IVIg therapy, desperate patients and family members could start to put pressure on already tight IVIg supplies. 

In turn, industry pricing could conceivably start to climb again, well before the Phase III trial answers important questions about the nature and extent of IVIg's benefits in Alzheimer's patients.

Implications: The expected near-simultaneous U.S. introduction of Omrix' ZymoGenetics' topical thrombin products has become a 4- to 5-month head start for Omrix with yesterday's FDA approval of "Evithrom" and last week's 3-month PDUFA postponement of rThrombin until January 17th. Aside from a delay in a $40 million approval milestone payment from marketing partner Bayer, the question is whether and to what extent this delay will hurt ZymoGenetics' commercial prospects for its much-touted recombinant human thrombin. 

Analysis: I expect that this head start for Omrix will not importantly change the outcome of the head-to-head battle between the two newcomers and King Pharmaceuticals, whose bovine plasma-based "Thrombin-JMI" product has enjoyed an eight-year market monopoly.

This three-way battle may be unique in one very important respect:  never to my knowledge have three entirely different technologies, with very different underlying costs of goods and R & D investment profiles, duked it out for the very same therapeutic use and place on hospital drug formularies.

Implications: Albumin is administered after major surgeries and in critically ill patients with a host of medical problems (shock, severe liver disease, severe burns, etc.).  Hospitals use a lot of it. Chinese health authorities moved recently to shut down the many blood centers that paid people for blood donations, but they didn't count on a serious side effect:  less blood plasma, the raw material manufacturers need to purify human albumin. The acute shortage has forced China to import albumin from US and European manufacturers -- just as domestic demand has picked up strongly.  And, 60 years after it was first used in WWII, potentially huge new demand drivers for albumin are looming in the near future. Things will get much more interesting for plasma fractionators and investors in this specialized sector.

Analysis: We are already seeing major ripples spreading internationally as China finds itself without enough human albumin to supply its surgical and intensive care units.

The underlying domestic problems that have precipitated this shortage will not be fixed easily or soon. 

China's albumin supply crisis is creating important opportunities -- and new challenges -- for the world's leading manufacturers of this unique human biologic.

Implications: Two decades of two-tier U.S. IVIg pricing based on liquid vs. powder delivery form has effectively come to an end with last Friday's FDA approval of CSL Behring's Privigen 10% liquid IVIg. As long as IVIg supply just keeps up with demand, all five current competitors -- Baxter, Talecris, CSL Behring, Grifols and Octapharma -- should continue to enjoy strong pricing and robust sales. But a disruption in these market conditions could significantly change the competitive environment for this increasingly commodity-like liquid IVIg product class.

Analysis: CSL Behring's Carimune NF was the last remaining powder-form IVIg product in a U.S. market that has been transitioning to the more convenient liquid 5% and 10% IVIg product forms.  Carimune NF will be phased out completely, ending availability of a "discounted" IVIg strongly favored by many price-sensitive hospitals.

With any important perturbation on the demand side, the competitive landscape could become interesting as the 5 current manufacturers find it necessary to promote on (1) narrow convenience- and safety-related features and (2) price.

Implications: Even as ZymoGenetics argues that its recombinant thrombin is safer than King's popular THROMBIN-JMI topical bovine thrombin product, the FDA has just licensed yet another THROMBIN-JMI line extension.  This time it's an intranasal spray delivery device for THROMBIN-JMI, which is designed to aid in stopping nosebleeds (epistaxes).  King plans to launch its THROMBIN-JMI Epistaxis Kit in the U.S. by the fourth quarter of this year.  It will join the THROMBI-Pad thrombin-impregnated hemostatic pad for use in controlling moderate to severe bleeding in the emergency department setting.  Suggestions that nearing approvals of new recombinant (ZymoGenetics) and human (OMRIX) thrombin products could prompt the FDA to strip the THROMBIN-JMI marketing license look very much like a case of wishful thinking.

Analysis: The FDA's willingness to approve THROMBI-Pad and THROMBI-Gel hemostats, and now the THROMBIN-JMI Epistaxis Kit, implies that the black box warning for THROMBIN-JMI was a more a response to problems reported with earlier, less purified bovine thrombin products.

Every indication is that King has big long-term revenue expectations for its growing THROMBIN-JMI product line.  King's three-way battle for its thrombin market -- against ZymoGenetics (and commercialization partner Bayer Pharmaceuticals) and OMRIX (and commercialization partner J & J/Ethicon) -- is quickly approaching.

Implications: Betting on Napoleon's military principle of superior force at the site of engagement, ZymoGenetics has enlisted Bayer's underutilized 95-person hemostasis sales/MSL group to try to convince major hospital users of King's bovine thrombin product to convert to recombinant thrombin. In the radically different European and Pacific Rim markets, Bayer has agreed to take on the challenge of securing regulatory approvals and marketing rThrombin, with its attendant risks and potential rewards. ZymoGenetics' CEO argues that history is on the side of recombinant versions of plasma proteins, and suggested specific safety, convenience and supply advantages that will win the day against King's popular Thrombin-JMI and Omrix' forthcoming human thrombin product.

Analysis: Recombinant thrombin offers important parallels with -- and differences from -- other recombinant biotherapeutics.  ZymoGenetics is betting heavily on the parallels to make its collaborative U.S. product launch strategy with Bayer pay off.

Certain key market-related differences between rThrombin and the list of successful licensed recombinant therapeutic proteins make this pending launch distinctly more interesting and challenging than the news release and conference call would suggest.

Interestingly, Bayer sales reps and MSLs who have been promoting infusions of bovine lung-derived aprotinin to reduce bleeding in cardiac surgery patients will soon find themselves talking to surgeons about safety concerns associated with topical use of bovine thrombin!

Implications: Five months after disclosing "top-line" findings from its 720-subject urban trauma trial, Northfield has released disappointing final mortality results, which failed to reach a presumptive 7% upper confidence limit for "non-inferiority" of PolyHeme against the current standard of care (saline + red blood cells).  Most surprising to some is the disclosure of 11 heart attacks in the PolyHeme arm vs. 3 in the standard treatment arm, which is reminiscent of an excess of heart attacks in an earlier aborted trial of the product.  The likelihood of a "class effect" -- myocardial events triggered by free hemoglobin solutions -- now seems difficult to dismiss, given similar problems seen with products developed by Biopure, Hemosol and Baxter Healthcare. The question now is what development options remain for Northfield (with nearly $50 million in cash) and surviving competitors in this 20-year old "race" for one of the Holy Grails of medicine.

Analysis: Northfield Labs has managed to go farther down the development path for its "PolyHeme" human hemoglobin-based oxygen carrier product than any of its mostly defunct competitors.

The basis for investor interest through most of the 3-year trial period was at least three-fold:  (1) PolyHeme exhibited no important safety concerns in prior trials, according to Northfield, (2) PolyHeme could be lifesaving in trauma, battlefield and other severe blood loss applications where blood was not available, and (3) PolyHeme might be safer than red blood cells, based largely on observations that more blood transfusions are associated with an increased risk of multi-organ failure.

The first of these three operating assumptions was shaken by a disclosure in February 2006, in the Wall Street Journal, of 10 myocardial infarctions (MIs) in patients given PolyHeme versus none in control group patients enrolled in an aborted elective surgery trial.

And the notion that PolyHeme might be safer than blood has vanished, now that the significantly higher rate of MIs has been documented in the 720-subject trauma trial.

What we still don't know -- and may never know -- is whether a clearly imperfect oxygen carrier like PolyHeme could potentially save the lives of badly bleeding trauma victims or soldiers who have received all the non-blood resuscitative fluids they can tolerate and desperately need an oxygen-carrying fluid in places where blood just isn't available.

Implications: Few if any biopharmaceutical "start-ups" can claim to have devoted more than 20 years to develop a single product.  But Northfield's synthetic oxygen carrier -- which can be used in place of blood and administered either inside or outside the hospital -- is not just any product.  A reasonably safe and effective temporary blood substitute is one of the Holy Grails of medicine.  Thus the company's stock continues to attract investors despite recent setbacks, including unspectacular preliminary findings from its pivotal trauma trial.

Northfield says it will file a BLA once its CRO (Quintiles) provides finalized data from a 3-year, 712-subject trauma trial concluded last year.  At issue, according to the company, is whether clean-up of those data will bring the PolyHeme group within the statistical definition of "noninferiority" for the study's primary endpoint (30-day mortality).  A "Special Protocol Assessment (SPA)" agreement with the FDA stipulates that this noninferiority finding would suffice for marketing approval. 

With its pending announcement that Quintiles will provide finalized trial results sometime in May, Northfield finds itself at yet another critical crossroads.  Either the data support a BLA filing (according to criteria outlined by the company) or Northfield's dogged 22-year pursuit of a universal substitute for human blood may finally be over.

Analysis: More than four months after reporting "draft top line data," Northfield has advised impatient investors that its CRO will report summary data from a pivotal Phase III trial of PolyHeme sometime in May. 

This protracted analysis is not surprising considering the complexity of the trial, which enrolled hemorrhagic trauma victims with multiple mortality risk factors and included 126 subjects (of 712) with protocol violations. 

At issue, according to Northfield's CEO, is whether mortality in the PolyHeme group (13.2% 30-day mortality) supports a determination of noninferiority to the control arm (9.6% mortality), which received resuscitation with saline and blood over the first 12 hours.  According to the company's statistical model, as little as a couple of deaths one way or the other could make the difference. 

Closer review of subjects excluded from the intent-to-treat analysis due to protocol violations (of which 70% of reported deaths were in the PolyHeme group) could also affect the final outcome, according to the company.

Implications: Northfield says it will work to persuade the FDA that the "per protocol" population of 586 subjects in its completed Phase III trauma trial offers the clearest evidence to assess the potential benefit of its blood substitute (PolyHeme).

The 30-day mortality rates in the PolyHeme and standard treatment groups (who received saline and blood as needed) were very similar in the "per protocol" analysis (30/279 and 28/307).  Acceptance of this argument by FDA could satisfy the noninferiority test that is one of the primary endpoints agreed upon in a Special Protocol Assessment (SPA).

Northfield sees a U.S. $400-500 million market opportunity for use of PolyHeme in clinical settings where blood is not available, and an overall worldwide market several-fold larger than that.

Analysis: FDA's usual review standard is the "intent-to-treat" population, which includes most subjects who violated the protocol in some fashion.  Mortality in the PolyHeme arm was marginally higher than in the control arm (46/349 v. 35/363), which just missed an agreed-upon statistical boundary of success, according to the company.

Northfield emphasizes that was unlikely that PolyHeme would prove superior to saline + blood in patients with typically short hospital transit times, who predominated in this Phase III trial.  But a noninferiority finding suggests that the product can be life-saving in cases where there is extended unavailability of blood.  The company's CEO cites the estimated 47 million Americans who live more than 1 hour away from a trauma center, for example.

Remaining pre-BLA preparation steps prior include (1) unlocking, finalizing and relocking the dataset, with the possible amendment of primary endpoint results, and (2) conducting additional analyses, importantly including a multivariate analysis that evaluates 30-day mortality adjusted for seven important risk variables.

Northfield plans to file its BLA this year.  With only about $50 million in working capital remaining, the company will need to raise additional funds.  It's poised to do just that with its recent filing of a $100 million shelf registration.

Implications: ZymoGenetics has met an earlier announced goal of submitting a BLA for its flagship rhThrombin product before year-end 2006. Just a month ago, future rival Omrix Biopharmaceuticals filed its own BLA for a human thrombin.

The two competitors are now on a collision course with current market monopolist King Pharmaceuticals, whose bovine plasma-based Thrombin-JMI has been used without reservation by U.S. surgeons.

But unlike the rules of engagement for biopharmaceuticals, the dynamics of the impending battle over the surgery-based thrombin market will be quite different in nature, and the outcome likely much bloodier.

Analysis:

The U.S. thrombin market has grown nearly 10-fold since the late 1990s. ZymoGenetics hopes to displace bovine thrombin – which holds a monopoly position – in nearly 1,000 targeted U.S. hospitals where it is most heavily used as an adjunct to surgical hemostasis.

To do so, ZymoGenetics will likely hammer on unfavorable Thrombin-JMI immunogenicity data, possibly seeking "linkage" with the black box warning concerning remote bleeding and thrombosis risks of bleeding which appear on that product's labeling. The case for rhThrombin against the new Omrix human thrombin product will also be framed as referendum on comparative safety.