The Uphill Battle Of A Biotech That Switched Its Focus
By Dan Schell, Editorial Director, Life Science Leader
When Roger Crystal, M.D., says that he understands the importance of being “flexible” in the business of biotech, he’s not spouting typical ambiguous CEO-speak. In his case, he’s referring to his company’s willingness to pivot, to “pause” a path that they had invested years of time and resources to and choose a new core objective. That’s not an easy decision to make, and its ramifications stretched the definition of “flexible” for Crystal and his team at Opiant Pharmaceuticals.
AN INCREASED NEED AND A NEW MARKET
In 2009, the small biopharma company was working on developing a naloxone nasal spray for binge-eating disorder (BED), which is America’s most common eating disorder. “The problem was — and is — a substantial one, and there is a serious need for improved treatment,” Crystal says. The plan was to use naloxone as a pharmacological therapy to block the reward from bingeing.
But during the next few years an opioid epidemic in the U.S. continued to spiral, seemingly out of control. For instance, in 2014, an estimated 1.9 million people had an opioid-use disorder related to prescription pain relievers and an estimated 586,000 had an opioid-use disorder related to heroin use, according to the Substance Abuse and Mental Health Services Administration. Even more disturbing was the fact that the rate of overdose deaths involving opioids — including prescription opioid pain relievers and heroin — had nearly quadrupled between 1999 and 2014, according to the U.S. Department of Health and Human Services.
"Being a small company enabled us to transition quickly to our new business objective."
Roger Crystal, M.D.
CEO, Opiant Pharmaceuticals
“Faced with the scale of this crisis, my colleagues [the company had three employees at this point] and I had a choice: We could continue on the project we had originally embarked on with BED, or we could reassess our priorities and attempt to fill the need for a new opioid antagonist treatment for opioid overdose,” Crystal recalls.
At the time, injectable naloxone was already approved for the treatment of opioid overdose, but even in the hands of trained first responders, there was concern because of the risk of needlestick injuries, often the need for users to assemble the injection, and the potential for variation of absorption depending on the patient’s body mass. Opiant’s plan was to offer naloxone as a simple-to-use nasal spray that initially would be for first responders, but could be coprescribed with every opioid painkiller prescription. “We felt there was a huge market we could access if we could provide a safer and easier approach to delivering the naloxone,” explains Crystal.
As a surgeon, Crystal had dealt with several overdose patients in the ER, so he understood the importance of delivering naloxone to a patient as quickly as possible rather than waiting for paramedics to arrive at a scene. “Every minute’s delay in receiving naloxone can determine whether the patient survives,” he explains. Also, through his management consulting and industry roles, he understood how to expand into new markets and the value proposition a naloxone nasal spray would offer once in the hands of patients, friends, families, and other first responders.
To further reinforce the decision to pursue this new drug, Opiant contacted and interacted with a lot of key opinion leaders and experts at the National Institute on Drug Abuse (NIDA) and harm-reduction organizations. Ultimately the company confirmed that the market potential was far greater than what currently existed for the injectable. Thus, in 2012, Opiant decided to make the switch.
SEEKING ASSISTANCE BEFORE GOING TO THE FDA
Although the company’s small size enabled it to be flexible enough to shift focus, that same size hampered its ability to quickly execute on such an ambitious new goal. Opiant needed help, and it would get it from three sources: the FDA, NIDA, and another specialty pharma called Adapt Pharma.
“To an extent, we were venturing into the unknown because there was no precedent,” Crystal recalls. “We wanted to develop the first FDA-approved naloxone nasal spray, so accessing investors who could appreciate the market potential was challenging. If this were another breast cancer drug, for example, then it would have been much easier for an investor to benchmark.”
The first thing they did was hire a CMC (chemistry, manufacturing, and controls) consultant to oversee manufacturing and a regulatory consultant to oversee all interaction with the FDA. During this same time period, Crystal and his colleagues decided that having the support of a major stakeholder would be an important endorsement — particularly to investors — of their new program. So, they established a clinical trial agreement with NIDA in January 2013.
Representatives from NIDA also accompanied Opiant to the initial pre-IND (investigational new drug) meeting with the FDA. “We needed to get the FDA to support our drug development plan,” Crystal says. “The FDA ‘confirmed’ that the development route was 505(b)(2), but also agreed with our development program that resulted in the rapid approval.” This pathway allows a company to rely on the FDA’s findings of safety and efficacy for a previously approved drug — naloxone in this case — so that the number of clinical studies required for approval is reduced along with time to market.
NIDA was able to sponsor a clinical study of three to four weeks duration to evaluate the pharmacokinetic properties of the new formulation of naloxone in human subjects. The study confirmed that the new novel formulation could be absorbed as quickly as injectable naloxone. “Having that information allowed us to explore all potential areas where a nasal spray could be used: schools, all first responders, addicts/ needle exchange clinics, methadone clinics, etc. We even could explore opportunities for coprescribing it with any opioid painkiller prescription, because even patients who don’t abuse opioids are at risk of an overdose and could benefit in having access to the nasal spray at home,” explains Crystal.
The data from the clinical trial was made available in December 2014, and the product was launched in February 2016. “We had to wait for more stability data on the product before the NDA could be submitted,” he explains. “Still, that time frame was significantly shorter than what’s typical regarding the road from clinical studies to commercialization.”
NEXT STEP: COMMERCIALIZATION
Again, Opiant’s leaders knew the company’s small size would require them to partner with a larger player to bring the nasal spray to market. That’s where Adapt Pharmaceuticals comes into the picture.“We were introduced to them by an advisor,” Crystal says. “We needed a partner with a similarly nimble and entrepreneurial mindset to ourselves accompanied by deep commercial expertise in the U.S. in CNS specialty pharma. Adapt shared our passion for the product and has a great track record at Azur Pharma, their previous spec pharm business that was acquired by Jazz Pharma.” He adds that the company did have significant interest — including a term sheet — from other larger pharma companies, but they weren’t convinced that those companies understood the product potential, were committed to ongoing innovation around the product, or were willing to invest significantly in its commercialization.
Through the licensing deal with Adapt, Opiant could receive potential development and sales milestone payments of more than $55 million, plus up to doubledigit royalties. Today, NARCAN (naloxone HCL) Nasal Spray is the first and only FDA-approved nasal form of naloxone for the emergency treatment of a known or suspected opioid overdose.
“Looking back, I am convinced making this transition was the right choice for our company,” Crystal concludes. “Being a small company enabled us to transition quickly to our new business objective, but we also couldn’t have done it without the cooperation of the FDA, NIDA, and Adapt. In the end, our flexibility paid off.”