Antiviral work helps Idenix buck biotech stock trend
There’s at least one bit of bright biotech news amid all the economic ugliness.
Cambridge-based Idenix Pharmaceuticals (Nasdaq: IDIX) ended the year with its stock price up 114 percent, compared with the biotech industry that overall by one measure — an analysis by the Biotechnology Industry Organization — was down by a median of 61 percent.
CEO Jean-Pierre Sommadossi said the recipe was simple.
“We set out our goals for the year, and we met every single one of them,” he said in an interview.
Idenix, which employs 180, plans to have big news in the next few weeks — an agreement to outlicense its HIV drug, IDX899, which is in phase 2 clinical trials. The negotiation process began in the spring, and equity analysts say a license agreement is currently being worked out by attorneys.
The company already has one drug on the market — Tyzeka/Sebivo for hepatitis B — that is licensed to Novartis. A report by Standard and Poor’s projects 2009 sales for the company to be $11 million, mostly due to royalties from Tyzeka/Sebivo.
The stock climb came even though the company remains unprofitable and had an operating loss in each of the last four quarters. Standard and Poor’s predicts operating losses for the next few years as the company focuses on expensive research and development activities.
Idenix raised a total $68.5 million in two venture rounds before it went public in 2004. The IPO was worth $140 million and a second offering in 2005 yielded $150 million. The stock closed at $5.70 on Jan. 14, following a high of $10.10 over the last year. Standard and Poor’s projects a 12-month target share price of $7.
The drug candidate up for sale would be part of a cocktail typically taken by HIV patients, and would target drug-resistant forms of the virus.
Up to 15 percent of patients newly diagnosed with HIV are infected with a strain which is resistant to at least one drug currently on the market. Once that deal goes through, the company plans to focus its efforts on developing three drug targets for hepatitis C.
Idenix has just announced it is initiating a proof-of-concept human trial for one of the three, IDX184. The drug target would focus on patients who have not yet received any treatment.
Idenix competitors include Gilead Sciences of California, Bristol-Myers Squibb is in New York and GlaxoSmithKline, all of which have HIV drugs that have been approved by the U.S. Food and Drug Administration.
Locally, Panacos Pharmaceuticals Inc. (Nasdaq: PANC) in Watertown, a 42-employee startup with research operations in Maryland, wants to be among the first out of the gate with its drug Bevirimat, which is designed to hit an HIV virus target discovered about a decade ago.
Idenix ended 2008 with approximately $46 million in cash and cash equivalents.
Company officials said Idenix would need that money, plus the proceeds from the licensing of the HIV drug, to get through the next year. Sommadossi said the company’s ultimate goal is to become the first biopharmaceutical company in clinical development with hepatitis C drugs from three different classes.
Unless Idenix gets bought first.
“It would be up to the board to decide if the sale of the company would be in the best interests of the shareholders. But the challenge for any deal over the past few months has been valuing the company. Our market cap has varied up to 20 percent to 30 percent in a single day,” Sommadossi said.
Julie M. Donnelly can be reached at juliedonnelly@bizjournals.com.
West Bridgewater hopes to be part of biotech boom
West Bridgewater officials consider easing permitting requirements to lure firms to town
The cure for cancer, AIDS or multiple sclerosis might be discovered in this small town, local officials say, if they can bring in biotech businesses.
Selectmen are enlisting the help of the Massachusetts Biotechnology Council, a trade association based in Cambridge, to help market West Bridgewater as a place for the state’s 400 biotech companies to do business, a move that would lure good-paying jobs and commercial tax revenue to town.
To make West Bridgewater more appealing, the town is also considering relaxing permitting requirements for biotech companies to come to Manley Street, the town’s commercial and industrial corridor, said Selectman Matthew Albanese, who was appointed as the town’s liaison to the council’s Massachusetts BioReady Communities campaign.
“The idea is to get West Bridgewater on the map in terms of hosting biotech companies,” Albanese said.
Massachusetts is a hub for biotech companies, said Peter J. Abair, economic development director for the biotech council.
Biotech companies generate $5 billion in payroll taxes and $6 billion in exports, a quarter of the Bay State’s exports.There are 1,827 drugs being developed in Massachusetts, more than 7 percent of the global drug pipeline.There were 44,005 Massachusetts biotech jobs in 2006, 30.4 percent more than in 2002. The average salary for biotech workers is more than $100,000.“It’s an industry that’s running counter to the Massachusetts economy, which shed jobs in the first part of the decade, and our industry grew jobs,” Abair said.
To make Massachusetts a biotech leader, Gov. Deval Patrick in July signed a $1 billion life sciences research bill that provides $500 million for new research facilities and labs, $250 million for research grants and $250 million in tax credits for companies in the life sciences industry. Supporters said the measure would create 250,000 jobs.
The Mass BioReady Communities campaign is working with communities interested in hosting biotech companies and rating them based on how well they would support the industry, using a four-point system of bronze, silver, gold and platinum.
For instance, a bronze community offers municipal water and sewer and zoning for biotech by special permit. A platinum community offers buildings permitted for biotech with 20,000 or more square feet, Abair said.
About 40 communities, including West Bridgewater and Weymouth, are seeking ratings, which should be released by March.
Albanese said West Bridgewater, which offers municipal water and zoning for biotech by special permit and has hosted biotech companies in the past, is aiming for a bronze or silver rating.
He said there are buildings in town now where a biotech company could relocate. For instance, Pressure BioSciences Inc., which makes specialized instruments for use in the health care industry, once did business at 321 Manley St., but relocated last March to Easton.
As state aid and tax revenues continue to decline, Albanese said West Bridgewater will face increasing competition from other Massachusetts communities courting biotech.
“It’s going to be Walpole versus West Bridgewater, or Waltham versus West Bridgewater,” he said.