Osiris drug wins 2d fast-track status

BUSINESS DIGEST

January 09, 2007|By Tricia Bishop | Tricia Bishop,Sun reporter

Baltimore's Osiris Therapeutics Inc. announced yesterday that the Food and Drug Administration has granted its lead stem-cell drug a second "fast-track" status - this time to expedite its development as a therapy for Crohn's disease.

In 2005, the agency fast-tracked development of the drug Prochymal as a treatment for a dangerous reaction to bone marrow transplants called GVHD, which annually affects about 4,500 Americans.

Crohn's, characterized by chronic intestinal inflammation, afflicts more than half a million people in the U.S., according to the Centers for Disease Control.

Osiris works with stem cells culled from the bone marrow of adult volunteers. The company already has one product on the market, a stem-cell hybrid used to regrow bone.

But Prochymal is on track to become the first full-fledged stem-cell drug to reach the market. It's already the furthest along in development, with final-stage clinical testing for GVHD under way, and - now - such testing cleared for Crohn's.

No other stem-cell drug has reached that stage, nor have any others received fast-track status, which is granted when a product shows significant promise in treating serious or life-threatening conditions.

In October, Osiris released results from a small study showing that Crohn's patients who were resistant to other treatments experienced a reduction in symptoms after being treated with Prochymal. The drug appears to respond as needed to varying levels of inflammation.

In a report issued last fall, analyst Joel D. Sendek of Lazard Capital Markets said the competition among Crohn's treatments is stiff. At least three other treatments are expected to enter the market over the next few years.

Analyst Eun K. Yang of Jefferies & Co., has predicted an annual Crohn's market opportunity for Prochymal of about $1 billion - 50,000 patients treated at an estimated cost of about $20,000.

Osiris announced the fast-track designation and clinical testing clearance after markets closed yesterday. Stock in the company, which went public in August at $11 per share, rose 71 cents to close at $25.07 on the Nasdaq.

tricia.bishop@baltsun.com

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