The vision of Life Science Leader is to be an essential business tool for life science executives. Our content is designed to not only inform readers of best practices, but motivate them to implement those best practices in their own businesses.
Issue link: https://lifescienceleadermag.epubxp.com/i/267232
COMPANIES TO WATCH Column LIFESCIENCELEADER.COM MARCH 2014 12 W A Y N E K O B E R S T E I N Executive Editor Finances Vital Statistics D A V I D W E B E R President and CEO OTONOMY B y W. Koberstein OrbiMed, Aperture, Domain, Novo, RiverVest, TPG Biotech, Osage University Partners Series A : June 2010 Series B : Aug. 2010 Series C : Sept. 2013 $10M $38M $46M 27 Employees Headquarters San Diego, CA Latest Updates DECEMBER 2013 Enrolled f rst patients in pivotal Phase 2b clinical trial of OTO-104 in Ménière's disease and two Phase 3 trials of OTO- 201 in pediatric patients undergoing ear-tube placement surgery. SEPTEMBER 2013 Completed $45.9 million Series C f nancing. SNAPSHOT Otonomy is a private company developing a line of new therapeutics for the ear using its own proprietary formulation of existing anti- biotics and steroids. Its OTO-201 (reformulated ciprofloxacin) is now in Phase 3 trials for use during ear-tube placement surgery, and OTO-104 (reformulated dexamethasone) has completed a Phase 1b trial, the first of two pivotal stud- ies for the treatment of Ménière's disease. The company also has initiated a third development program, OTO-311, that utilizes a new molecule, the N-Methyl-D-Aspartate (NMDA) antagonist gacyclidine, for the treatment of tinnitus. WHAT'S AT STAKE Whatever flows in can also flow out. At least, the simple rule applies to the ear, as anyone who has ever used ear drops knows well. Otonomy chose its modus operandi for that reason. Clinical research already had shown the usefulness of "intratympanic (IT) drug treatment," as in ear-drop delivered antibiotics in the treatment of otitis media and steroid solutions to treat patients with Ménière's disease or acute onset hearing loss. But the swift elimination of the drops from the ear limited treatment efficacy, and no one had addressed the problem. Thus Otonomy began with the aim of developing spe- cial formulations of existing drugs rather than original molecules for the ear conditions. The company developed its proprietary "sus- tained-exposure" formulation not to get into the platform business, but to overcome the ear-drug delivery problem for the large patient groups suf- fering from the curse of dizziness, hearing loss, Not to build a platform, but to create new, FDA-approved therapeutics for unserved indications in the ear, this developer focuses on novel delivery. OTONOMY and other discomforts of ear disease. Backed, it says, by a strong vault of patent protection, it is going after indications where the FDA has never specifically approved a drug. For those reasons, says President and CEO David Weber, "Otonomy is able to maximize its market opportunity and support a premium-pricing position." Weber says the same strategy also limits risk. Heretofore, doctors have improvised dosing to the inner ear. "Physicians use oral and local injections (called intratympanic injections) of steroid solution off-label to treat these condi- tions," Weber says. "However, dosing to the inner ear is limited and variable, which necessitates repeat administration and likely compromises efficacy." Otonomy's formulation uses an inject- able thermosensitive gel to slow elimination of the drug from the inner ear, thus boosting effectiveness and eliminating the need for more frequent injections. Short-acting ear drops are approved only for outer ear and recurring mid- dle-ear infections following ear-tube placement, but not for OTO-201's lead indication: intraop- erative use during ear-tube placement surgery. According to Weber, ear specialists have identi- fied many additional indications for OTO-201 — infections throughout the ear left unaddressed by short-acting ear drops or any other treatment. Although combination of components in the sustained-exposure formulation is novel, the parts themselves — the gel, APIs, and injector — are all off the shelf. Thus, says Weber, there are no pricing, licensing, or availability issues for these materials. "We manufactured clinical trial material for our OTO-201 Phase 3 studies at com- mercial scale, and are doing the same to support the OTO-104 late-stage program." Otonomy's recent C round will fund the Phase 3 trials it now has underway. The company must continue to explore other alternatives such as global partnerships for further clinical develop- ment. But, because the physician audience is relatively small and would require only about 100 reps in the U.S. market, the commercial part- nering strategy has more nuance: "Our current business plan is to self-commercialize our prod- ucts in the United States and work with partners for all other markets." For a company with broad worldwide patents and original products for unserved indications, the strategy seems logical and appropriate. It is also a good example of how a novel platform, even a new creative assembly of existing pieces, can be put to an immediate, targeted therapeutic use. l A B C Raised To Date $94M 0 3 1 4 _ C o l u m n s _ C T W . i n d d 1 0314_Columns_CTW.indd 1 2 / 1 9 / 2 0 1 4 2 : 0 4 : 5 8 P M 2/19/2014 2:04:58 PM