Mother's search for cure drives biotech business

Quest: Challenged by news of her daughter's rare lung disease, Martine Rothblatt built a firm that has become a Wall Street favorite.

October 24, 1999|By Mark Guidera | Mark Guidera,SUN STAFF

In 1991, Martine Rothblatt got some jarring news from doctors: Her 8-year-old daughter, Jenesis, suffered from primary pulmonary hypertension, a rare lung disease that is difficult to treat and can be fatal.

A bibliophile, Rothblatt plowed into everything she could read on the subject. "I was really scared by what I read," she recalled.

Only about 5,000 cases of the disorder a year are diagnosed in the United States and Europe. In these patients, the blood pressure in the pulmonary artery connecting the heart to the lungs becomes abnormally high. It is marked by a shortness of breath, fatigue and fainting spells. Parents and patients hope that the standard therapy, a drug called Flolan, will work. Otherwise, they must seek a heart-lung transplant.

Rothblatt didn't like the outlook for Jenesis, or the tedious treatment regimen, which included wearing a backpack-size container filled with Flolan and a surgically implanted catheter.

So the satellite communications executive, no stranger to a big challenge, began a quest to find a better treatment.

The result of that eight-year effort: The 45-year-old woman now heads United Therapeutics Corp., which she founded in 1996.

Despite long odds, Silver Spring-based United Therapeutics has emerged as a favorite of biotechnology industry analysts and investors on Wall Street. Since June, when the company went public, its stock has more than doubled, closing Friday at $28.875.

"When you first hear about an executive forming a company because she's got a sick daughter, you tend to be cautious about what's really going on," said Robert J. Toth, senior biotechnology analyst at Prudential Vector Healthcare in San Francisco.

"But Martine hasn't let emotion get ahead of running a solid company. I would argue she's an extremely savvy business manager who's been making some very smart decisions," Toth said.

The chief reason for investor interest: Rothblatt has acquired rights to a small portfolio of promising drugs that big pharmaceutical concerns had either shelved, axed, or won't market in the United States.

The leading candidate is UT-15. Toth believes that the drug, which is in late-stage clinical trials, could be on the U.S. market as early as 2001.

He estimates that the drug could generate $75 million in revenue that year, and potentially $2 billion annually if it wins approval in Europe and the United States. The drug could make the company profitable, despite the relatively small number of people afflicted with primary and secondary pulmonary hypertension: about 40,000 in both markets.

Although its cost is expected to be about $50,000 a year per patient, it's still cheaper than the $100,000 a year Flolan costs, the reason health insurers are expected to embrace it.

The drug is designed to be delivered under the skin through a beeper-size pump patients could wear on their belts, eliminating the risk of infection and the need for a catheter. The company has a deal with MiniMed Inc. of Sylmar, Calif., maker of a miniature insulin pump, to market the drug and pump if approved.

Rothblatt also gets kudos from Wall Street for drafting top talent.

Since launching United Therapeutics with $30 million raised from investors, she has shed all other responsibilities.

"This," said Rothblatt, "is my mission in life."

The Los Angeles native, who holds MBA and law degrees from the University of California at Los Angeles, is no stranger to the rigors involved in starting a company. She has helped found or run at least three satellite communications companies. They include publicly held PanAmSat Inc., a Greenwich, Conn., satellite TV and communications company.

But a drug company brings its own set of obstacles.

For one, the time and cost of developing even a single drug are crushing.

The Pharmaceutical Manufacturer's Association of America estimates that it takes seven to 10 years and more than $300 million to develop a drug and get it to market. There is always high risk that the drug will fail.

Rothblatt said she was undeterred by the statistics. She believed that she could expedite getting a promising pulmonary hypertension drug tested and approved.

"I've spent my whole life having people tell me something would take 10 years, and getting it done in three or four," said Rothblatt, who used her graduate thesis at UCLA as a springboard for co-founding PanAmSat.

After her daughter's illness was diagnosed, Rothblatt compiled a list of the world's top pulmonary hypertension experts and founded the Pulmonary Hypertension Cure Foundation in 1994.

An epiphany of sorts came when a friend gave her the film "Lorenzo's Oil," which tells the powerful story of a couple's quest to find a treatment for their son's degenerative brain disease.

Rothblatt said the Oscar-nominated movie had an enormous impact, persuading her to dedicate her time and energy to getting a better drug developed.

"I knew I had to get smarter about this," said Rothblatt.

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