Over a period of decades, Australia’s pharmaceutical ecosystem has birthed a number of companies with unique intellectual property (IP) around different forms of drug delivery.

This week we spoke to three companies — two listed and one private — now working towards promising commercialisation objectives.

Like most things biotech-related, confirming the safety and effectiveness of new drug delivery technologies is a multi-year process — but that process can also present opportunities.

For example, among the ASX CEOs we spoke to one key takeaway was the various applications in the generic drug market. In effect, that means taking existing (and most importantly — clinically approved) treatments, and applying a new and improved delivery technology.


Same drug, better vehicle

Such an opportunity was flagged by Suda Pharmaceuticals (ASX:SUD) CEO Dr Michael Baker, for the company’s Anagrelide project.

Having first listed back in 2002, Suda’s core focus is on developing drug delivery techniques via oral spray, where Anagrelide represents something of a “blue sky opportunity”, Baker said.

As a treatment for Essential Thrombocythemia, the drug was first developed and approved about 20 years earlier as a way to reduce platelet numbers in patients.

“High platelet levels (which normally assist in the clotting process) in some cancer types creates really bad outcomes in terms of survival,” Baker said.

“What limited sales was — if you take it as a pill, during that metabolism process it gets converted into a cardiotoxic intermediate which is bad for the heart,” Baker explained.

“That’s why we need to convert it to an oral spray. And if we can do that we should have a product that’s safer, and hopefully can increase the lifespan of cancer patients. Looking at the program, we really couldn’t ask for a more important molecule for spray conversion. So it’s a great opportunity.”

The company was also the recent recipient of Therapeutic Goods Administration (TGA) approval for ZolpiMist, its mouth spray reformulation of the insomnia drug zolpidem.


Niche market

Another listed company in the space is the Melbourne-headquartered Acrux (ASX:ACR), which has 13 drugs under development — all of which are applied via the skin (topically).

Like Suda, Acrux has a relatively long history, having first been spun out of Monash University in 1998 following research into the application of different drugs on the skin.

Speaking with Stockhead, CEO Michael Kotsanis said the company had established an interesting niche within the US pharmaceutical industry — its core target market.

“We’ve got 22 years of R&D behind us, which is why we work in this space. At the same time, an interesting feature of topicals is that the total market for pharmaceuticals in the US is around $US500bn ($696.4bn). And within that, the market for topicals is around $US18bn,” he said.

“It still sounds like a lot but its actually quite niche. When companies develop products, they’re interested in the injectable market or tablets and capsules.

“And the area we focus on is that in the US, you often find products on the market that are really expensive. Our aim is to copy them and bring them out cheaper. That’s our business model and it’s why companies are licensing our product.”

Since late-May Acrux has signed three agreements — two licensing deals for products in its own portfolio, and a co-development project.

“We can’t disclose too much yet about what the products are, but they’re all applied topically and will eventually be sold in the US,” Kotsanis said.


Needles out, patches in

Staying on the topicals theme, Stockhead also spoke this week with David Hoey, the Boston-based head of Aussie biotech company Vaxxas.

Although still a private company, Vaxxas has raised more than $60m in R&D capital for Nanopatch — a device shaped like an ice hockey puck which can be used to administer vaccines via the skin in place of needles.

As part of a partnership development agreement, Vaxxas has also taken on an $US18m investment from Merck & Co — the $US215bn pharmaceutical giant which is also the world’s largest vaccine developer.

And Hoey said the company, which was spun out of the University of Queensland in 2011, allocated most of that funding to product engineering.

“There’s a tremendous amount of work we’ve had to do in manufacturing because when you print the vaccine onto a patch you cant see it. But you still have to be able to make a product that can meet with quality requirements,” he said.

“Then you need to operate enormous throughput — potentially millions of units per week. So most of our investment isn’t on the immunology, it’s how you make the device.”

Hoey said on the immunology side, the company had conducted three clinical trials (all in Australia), with the most recent (and largest — comprising around 200 people) completed in March.

“What was interesting is we went down to one-sixth of a dose on the patch — effectively a lot less vaccine to achieve the same performance. And when we looked at the immune response, it was the same amount on the patch and syringe,” he said.

Hoey said the result indicated that the patch delivery mechanism offered better durability than existing needle-based vaccines such as seasonal flu shots.

The company also has backing from the Bill & Melinda Gates Foundation to explore use cases in lower-income countries, which is aimed more at public health outcomes rather than commercial growth.

And before COVID-19, Hoey would have put ‘pandemic response’ in the same public-health basket. But in the wake of the virus, the company is now in talks with potential government clients and “that business is real”.

Looking ahead, he said the primary distribution challenge would be centred around disrupting a multi-billion global vaccine supply chain that’s based on needles.

“What’s going to drive adoption are the things that make it economically more attractive. Our ability to enter those mature markets and displace incumbent products with patient preferences and superior economics,” he said.

Pointing to the Merck partnership, Hoey said the global vaccine market was top heavy, as opposed to therapeutics where there were hundreds of companies.

“There’s maybe a dozen companies you need good relationships with to have an eye on 80 per cent of global vaccine sales,” he said.

“If you’re a big company and you don’t have a strategy for how you’re transitioning beyond needle and syringe, you’ve got a problem. It’s not here today, but it’s coming.”