Botanical Drugs: An Emerging Opportunity for Indian Pharma

India clearly has several advantages when it comes to herbal product development. However, data protection will have to be tightened further and efficiencies improved. A review of the regulations and business opportunities in this emerging market

Jayesh Chaudhary

A quick look at India's contribution to the healthcare innovation worldscape so far is enough to conclude that we have not yet made our mark. Inadequate skills and resources in New Chemical Entity (NCE) research have limited us up to Phase II development of our molecules whereas lack of vision has restricted the Ayurvedic sector to only the Nutraceutical markets worldwide. One must concede that new drug development and approval requires fat R&D budgets and there was no allowance given by the local drug authorities to phyto-pharmaceuticals, even those with a long history of usage in the country.

Realizing the mounting healthcare costs in the developed markets and the potential of the natural drugs discovery platform, regulators in some major markets woke up to the need to either provide better access to proven safe nutraceuticals or give concessions to multi-active partially characterized phyto products to shorten approval time and cost, much like the German market.

New Regulatory Environment

The FDA and EMEA recently provided a significant fillip to the Natural Products Industry have significantly lowered the entry barriers for botanicals vis-à-vis chemicals and biologicals in these regions. These new guidelines more importantly also provide for unique guarantees of market exclusivity for botanicals as well as the acceptance of synergistic combinations of bioactives. Botanical drug products (or Herbal Medicinal Products as they are known in Europe) will ultimately compete alongside conventional in the $ 500 billion global pharma market. Local regulations amongst the EU member states may differ slightly. Botanical Drug Products (BDPs) or phyto-pharmaceuticals should not be confused with pure isolated single compounds of natural origin or semi-synthetic molecules like paclitaxel and artemisin. The new FDA regulation in fact is significant in recognizing semi-purified multi-compound plant or animal origin extracts. The FDA Guidance has also reduced emphasis and urgency on preclinical toxicological data as well as Phase I data especially for products which have a documented long history of use in the US or any originating country.

Business Opportunity

India (along with countries like China), with its vast library of natural compounds - some actively used in traditional systems and many still not codified - has clearly a natural advantage over the others. Apart from the starting material, we have what it takes in terms of research capabilities to take the product upto Phase II. Indian investigators and CROs and Indian Pharma may have participated in global Phase III trials but we may not be confident yet for managing the full clinical development and regulatory aspects of an New Drug Application (NDA). Indian companies in the pharma, biotech, ayurvedic and nutraceutical space have an opportunity to develop and market a BDP worldwide. Our global marketing setups may have developed adequately in the next four-five year horizon considering the prolific acquisitions by Indian pharma overseas. If that is too wishful a thinking, then Indian innovators still have the out-licensing, royalty and co-marketing revenue streams available. There are always niche segments which are not attractive enough for the Big Pharma to develop and market as they are not interested in molecules with less than a $ 200 million market. These could be potential targets for Indian companies, now that the financial barriers to new drug development have been significantly lowered. We have to claim our stake in the Global Botanical Pie, lest we are left with only the crumbs. Some initial successes have been made and many more are in the fray.

Success Stories

Two commonly used nutraceuticals have been approved as Botanical Drug Products by FDA - Veregen (also known as Polyphenon® E) and Omacor (now known as Lovaza). While Veregen is a green tea based topical product for genital and perianal warts, Omacor is an omega-3 fatty acid product from fish oil approved for hypertriglyceridemia. Let us look in greater detail at Veregen the first approved BDP and the marketing alliance that is now commercializing this pioneering product now.

Veregen / Polyphenon® E Ointment

Genital warts are benign tumors caused by HPV strains that disfigure the genital region and can be painful. It is one of the fastest growing sexually transmitted disease worldwide. The market revenues of genital warts treatments are growing by 7 percent annually. 14 million people in North America and Europe suffer from the disease, of which only about 3 million are currently seeking treatment. 10% to 20% of sexually active Americans are thought to be infected with HPV, resulting in 750,000 new cases of genital warts each year in that country, making it the largest market. Existing treatments include laser vaporization, freezing or repeated applications of cyto-toxic substances. The major problems are the high recurrence rate (in 20-60% of patients), the side effects (local reactions such as itching or pain) and the duration of treatment. Approximately 30 million people worldwide are infected by these viruses (HPV type 6 or 11) that cause genital warts.

Approved in October 2006, Veregen is scheduled to launch in the second half of 2007, and is patent-protected until 2017. Veregen will be promoted by Bradley Pharmaceuticals, Inc USA to the Dermatology and OB/GYN specialties. Veregen has been licensed to Bradley for US marketing by a German Botanical Discovery company MediGene, AG. MediGene has made projections for peak annual worldwide sale from this single product to touch $150 Mio. Figures by other analysts (Wolters Kluwer) put just the US market size for this segment at $ 200 Mio.

The active ingredient in Veregen is a defined mixture of kunecatechins extracted from green tea. Veregen is the first new treatment for this condition since Aldara was introduced in 1997. Veregen is claimed to produce significant clearance rates in males, a population known for resistant genital warts. During clinical development, Veregen showed high and sustained efficacy with very few adverse events. The results come from an international phase III trial on 1,000 patients in 15 countries. Veregen activates the body's defenses (immune modulation), inhibits major functions of the HPV and counteracts specific changes in tumor cells (growth inhibition). This presents two targets for efficient combat against the tumor, which may open up new therapeutic approaches for other skin diseases.

However, critics argue that while Veregen is effective, so is Aldara, the current market leader, and Aldara is a white cream that is applied to the genitals 3 times per week, compared with Veregen, a brown-red cream applied to the genitals thrice daily.

MediGene AG, Germany

Veregen or Polyphenon E is a research product of Medigene, AG, a publicly quoted biotech company located near Munich. MediGene claims to be the first German biotech company with a drug on the European market. Veregen is their second drug with several more currently in clinical development. MediGene also possesses innovative platform technologies and core competence in anti cancer therapies.

Bradley Pharmaceuticals, Inc., USA

The product, developed by MediGene AG, will be commercialized in the United States by Bradley Pharmaceuticals, Inc. and is expected to launch before the end of 2007. With FDA approval, MediGene was due a $14 Mio milestone payment from Bradley at the end of 2006. During 2006, they already paid MediGene $5 Mio in consideration for development and regulatory activities undertaken till then. The agreement provides for a total payout of $ 69 Mio to MediGene based on development, approval or marketing milestones reached for existing or newer indications of Veregen. Not to be compared with license fees negotiated with Indian pharmas recently, as Veregen is a botanical and for a niche indication. MediGene of course stands a good chance to more than recover its investments (figures not available) through these milestones and the several royalty streams (ranging from 5-15% of sales) built into the agreement. Bradley in turn estimates useful economic life of the product at 15 years, about five years beyond its patent life in the hope that development of generics for an array of natural compounds would be difficult. Though it is too early to predict the likely FDA thinking on "botanical ANDAs", Bradley's projection may be refuted as the natural products space does offer some opportunities for copycats to eat into market share if not develop generics. The agreement includes minimum purchase quantities committed by Bradley but also co-development possibilities to explore new indications for Veregen, with marketing rights outside USA remaining with the innovator.

Bradley is a specialty pharmaceutical company that provides therapies to niche physician specialties in the US and some international markets with sales revenues close to $150 millon. However, performance has been lackluster in the last two quarters which has also hit bottom-lines. It has no manufacturing facilities. The Veregen launch is awaited to see if it can turn the tide for the company as projected. Veregen launch may be a non-event for the pharma world but eyes in the botanical sector will be closely watching and Bradley has a huge responsibility towards some of the players in this sector.

The Score So Far

Figures available for the total number of INDs filed so far for BDPs is upwards of 300 with a large number of them from China. Numbers of INDs and approved products from other markets (European, etc.) will be discussed in another article.

But some firms with a pipeline dedicated to botanicals are known: MediGene (Germany), Reliant Pharmaceuticals (the US developer of Omacor), Phytomedics (USA), SunTen Phytotech (Taiwan), Phytopharma (UK), Phyto Health Pharma (The Netherlands), Nicholas Piramal (India) and Indigene Pharmaceuticals (India/USA). Closer home, Lupin has taken a lead with their anti-psoriatic Desoris project. They have received approval from the DCGI (Drugs Controller India) to conduct a combined Phase-IIb/III clinical trial for its botanical drug LLL-3348 a once-daily 16 week oral therapy.

India clearly has an advantage in terms of its immense biodiversity, trained manpower pool, scientific, medical and now fiscal resources and innovative approaches like "reverse pharmacology for herbal product development" However, data protection will have to be tightened further and efficiencies improved.

Conclusion

Drug development is not an easy process. But there are scores of small but innovative pharma and biotech companies from whom we could learn. Learn to improvize processes and do away with inefficiencies to embark on a global drug development program. With some courage and vision India Pharma and Phytopharma industry can also do it. The Botanical Drug Products opportunity seems real enough. It could indeed open up doors for the Indian Pharma to finally arrive on its own on the international scene.

(The author is Managing Director Vedic Lifesciences, a CRO serving the Botanical Drug Industry . He nor his company has no stakes in the products or companies mentioned in this article. All trademarks belong to their respective owners. Readers are advised to check current regulations and market conditions.)