Developing biobetters through evergreening is ‘high value’

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As reported by Subita Srimal in Mehta Perspectives on 6 January 2010, investment in biologics-based medicine is gaining momentum as these drugs offer targeted therapy and often safer treatment options, higher returns on investment and slower erosion of market share post patent expiry compared to small molecule-based drugs.


According to Mehta Partners, first-generation monoclonal antibody (MAb)-based drugs are the cornerstone of treatment of major diseases such as rheumatoid arthritis (RA), multiple sclerosis (MS), cancers and age-related macular degeneration (AMD). As the patents for these first-generation MAbs are set to expire from 2014 onwards, Mehta focuses on companies with novel technology platforms developing second-generation MAbs to deliver ‘better biologics’ (also called ‘biobetters’).

Mehta Partners states that second-generation targeted therapies using MAbs could offer drugs for novel targets, but also existing validated targets with a better efficacy/safety profile and/or improved versions of existing blockbusters.

“This ‘Ever Greening Effort’ has the potential to deliver molecules with a higher therapeutic index enabling optimally effective treatment to be achieved at a dose below the maximal tolerated dose, thereby minimising the adverse-event profile of the drug”, they write.

Mehta analysed two maturing platforms, which yielded several attractive RS investment opportunities, as discussed in its report ‘Ever Greening’ To Remain Evergreen: Evolution of Antibody Technology to Drive M&A.

These opportunities are highlighted in company-specific capsules:

• Second-generation MAbs: Ablynx, Morphosys, Trubion, and Micromet;

• Antibody drug conjugation (ADC): Seattle Genetics, Immunomedics.

Mehta expects the innovative technology platforms used to generate new MAbs to accelerate mergers and acquisitions (M&A) and attract robust collaborations, as some of these companies are at their inflection point as their products enter proof-of-concept (POC)/pivotal clinical trials.

Mehta states that collectively, all companies in the report offer a long-term investment opportunity, as the technology platforms used for generating these products are being validated by multiple partners. “Positive data could trigger M&A at a premium, like Abgenix, CAT, or Medarex”, they write.


Subita Srimal. Developing “Better Biologics” through "Evergreening" = High Value Proposition. Mehta Perspectives. 2010 January 6.

Source: Mehta Perspectives

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