I got a call from a reporter the other day asking me what I
thought about the Cubist
acquisitions of Optimer and Trius (See the link for the Cubist website). My response was – Cubist Rocks! These acquisitions are probably going to be
good for Cubist in many ways – but they are a sorely needed shot in the arm for
the future of antibiotic research and development around the world. These acquisitions validate the investments
in academia and biotech aimed at identifying new antibiotics against resistant
pathogens and even antibiotics that are not particularly members of new classes
of antibiotic – an extremely rare bird.
They will provide impetus for future investors and investments. They
should inspire large pharma to think twice about their current lack of vision
in the antibiotic space and to rectify this obvious financially attractive
blind spot.
So – the basics.
Cubist is a small pharmaceutical company with revenues of about $1B
almost entirely from sales of Cubicin (daptomycin), an IV antibiotic only
active against Gram positive pathogens.
95% of sales are in the US.
Cubist’s ability to leverage markets outside for the US still leaves
something to be desired (obviously). The original patent on daptomycin will
expire in 2016, but patents on methods of administration and on the more pure
form of daptomycin expire around 2020. Sooner or later, Cubist must find a way
to replace Cubicin. They have a
promising antibiotic for Pseudomonas infections, ceftolozane (+ tazobactam) in
phase III development, but nothing to addresss the Gram positive market
represented by Cubicin. The addition of
Trius’ tedizolid will provide a strong alternative to linezolid as an oral (and
IV) therapy for Gram positive infections. This compound has clear advantages
over linezolid (which will become generic in 2015) and should do well in the
marketplace – especially in the US and especially with Cubist’s experienced marketers behind it.
Cubist will pay up to $818MM including milestones for Trius
(with $700MM being the purchase of Trius from its shareholders). This also includes the interesting early stage
clinical and preclinical programs at Trius. It will be interesting to see how all that is
merged into Cubist over the next year or two.
Trius had to go through FDA hell and partnering oblivion to
emerge victorious in the end. They had to deal with changing FDA endpoints, a
generally confused and inconsistent FDA overall and with an extremely skeptical
group of potential large pharma partners. They were forced to raise money
privately, with an important licensing deal with Bayer for Asian rights and
through an IPO to get through two phase III trials for tedizolid, one trial at
a time, cautiously raising money at each step of the way. This tortoise has
finally won the race. The fit with
Cubist is a good one. Tedizolid is a
solid inheritor of the Cubicin franchise, and can complement Cubicin during
Cubicin’s phase out (if that ever happens) as an oral follow-on to Cubicin
therapy. I think the Trius pipeline is
also a good fit for Cubist.
So Cubist-Trius is a win-win for the world! The world gets a badly needed additional
choice for oral therapy of Gram positive pathogens, and IV choice beyond
linezolid. The pharmaceutical industry gets a shot in the arm (and a kick in
the head) for antibiotic R&D. And I get to feed the optimistic side of my
view on the future of antibiotics and resistance.
On the Optimer purchase – I have little to say. Cubist was
forced to choose to extend its contract with Optimer or not last month –
obviously they chose an interesting path forward. Of course, lets not forget
that Cubist has its own candidate for the treatment of C. difficile diarrhea
(Surotomycin) already in phase III trials.
Optimer’s Difficid is already approved for that indication, although
sales are not great ($23MM in 2012). To
my view, that molecule has definite advantages over oral vancomycin but may
have been priced too high for the advantages it does offer. Nevertheless, Cubist is paying up to $800MM
for Optimer as well. But how Difficid
fits with Surotomycin and how Cubist will handle this I couldn’t say. All in all –this seems like not a bad problem
to have. Hey – I have two good products
for the same disease – what do I do?
So – Cudos to Cubist.
Congratulations to both Trius and Optimer. And good health to all those
of us who are going to need new antibiotics as we yield to the inevitable
passage of time.
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