Guilford gets OK to market cancer wafer FDA's green light called a turning point for Baltimore firm

Brain tumor deterrent

Wall Street applauds 'big achievement for a small company'

September 25, 1996|By Mark Guidera | Mark Guidera,SUN STAFF

Guilford Pharmaceuticals, the Baltimore based biotechnology company, won final Food and Drug Administration approval yesterday to market a biodegradable wafer shown to prevent the rapid recurrence of a deadly form of brain cancer, the first new treatment approved for the disease in 20 years.

Analysts hailed the approval as an important turning point for the growing biotechnology company, and Wall Street nodded its approval, sending Guilford's shares up $1.625, or 6 percent, to close yesterday at $29.25.

In clearing the Gliadel wafer just seven months after the company submitted its application for approval, the FDA followed the advice of its Oncologic Drugs Advisory Committee, and said that Gliadel can be marketed as a treatment for patients suffering a recurrence of the most severe and aggressive form of brain cancer, known as malignant glioblastoma multiforme. The FDA said the wafer should be marketed as an implant following surgery to remove tumors.

The company had hoped the FDA would allow Gliadel to be marketed for broader uses, such as treating early-stage primary brain cancer.

The nickel-size wafer is made from a biodegradable polymer that contains carmustine, a potent chemotherapy drug. The wafer is designed to be placed directly on the site of the tumor by neurosurgeons to prevent a fast recurrence of brain cancer.

The technology was initially developed and later licensed out by Dr. Henry Brem, director of neurosurgical oncology at Johns Hopkins Hospital, and Robert Langer, a professor of chemical engineering at the Massachusetts Institute of Technology.

"This is a big achievement for a small company," said Alex Zisson, a biotechnology analyst with Hambrecht & Quist in New York. "It was a pretty fast approval time by the FDA, which speaks well of Guilford."

Eric Sichel, a New York-based analyst who follows Guilford for Alex. Brown & Sons, said that, while the company had hoped for the FDA to issue approval for a broader use of the drug in the fight against brain cancer, the action was, nonetheless, an important turning point for the company.

"This is certainly good news for Guilford," said Sichel. "They can now get this product on the market and expand its usage later."

"It's the first time the FDA has approved a treatment which delivers chemotherapy directly to tumor sites," said Dr. Craig Smith, Guilford's president and chief executive officer. "Aside from the importance to business, this approval also has a very personal side to it," he said. "It's the first major new product to be approved for treating brain cancer -- which is a terrible disease -- in over a decade."

Indeed the San Francisco-based National Brain Tumor Foundation, an information clearinghouse, said Gliadel is the first new major product to come along for treating primary brain cancer in 20 years. Many patients diagnosed with the disease -- about 10,000 annually in the United States -- die within a year. The wafer is seen as significant by cancer experts because one of the drawbacks to conventional chemotherapy is that it can have debilitating effects on patients, and sometimes very little of the drugs get to tumor sites.

Meanwhile, industry analysts said yesterday's FDA approval was another confirmation of Guilford's biodegradable polymer wafer technology, which the company hopes to develop further as an innovative way to treat and prevent other types of localized tumors, such as ovarian cancer.

While the product isn't expected to be shipped for mass distribution in the United States until January, the FDA approval will have an immediate financial effect on Guilford's books.

The company, which lost $1.7 million on sales of $7.6 million in the first half of this year, is due a $20 million milestone payment from Rhone-Poulenc Rorer for landing the final FDA approval.

In June the Pennsylvania-based pharmaceutical company, which markets several promising new cancer treatments, struck an alliance with Guilford for the rights to market Gliadel and other polymer-based products developed by Guilford for cancer treatment. Smith said the FDA approval gives Guilford and Rhone-Poulenc "a very important competitive advantage."

Sales revenues from Gliadel and other polymer-based cancer treatments developed by Guilford will be split between Guilford and Rhone-Poulenc.

Zisson of Hambrecht & Quist said he projects that Gliadel will generate about $13 million in U.S. sales in 1997, with about $4.6 million of that going to Guilford.

If Gliadel wins approval for marketing in Europe, where about 10,000 patients annually are diagnosed with glioblastoma, the product could generate $25 million in sales in 1998, with about $8 million going to Guilford, Zisson estimated.

Eventually, said the analyst, Gliadel should generate about $100 million annually in the United States and Europe, with Guilford expected to get about 35 percent of the revenues.

Sichel, the Alex. Brown analyst, said that initial revenues from Gliadel might get a boost from a clinical trial Guilford is planning in the hope of proving that Gliadel is an effective treatment for treating early-stage brain cancer. Such a trial could make oncologists more comfortable with expanding their use of Gliadel beyond the limited use approved by the FDA yesterday, said the analyst.

Also, noted Sichel, physicians are not bound by the restricted use labeling of the product, and indeed oncologists have shown they are willing to use some new cancer fighting drugs much more aggressively than the FDA has said their makers can claim in marketing them.

Pub Date: 9/25/96

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