Real Science

Virtual pharmaceutical companies don't get much more virtual than Concordia Pharmaceuticals.

Based nominally in Sunrise, Fla., Concordia is composed of five colleagues who are scattered across the U.S. The company has no outside investors, no laboratories, not even a website.

What it does have is an in-licensed anticancer compound, farnesylthiosalicylic acid (FTS). It has the expertise of its five partners, all veterans of the pharmaceutical and related industries. And it has the benefit of chemistry and biology services from the outsourcing firm Ricerca Biosciences.

According to Victor J. Bauer, a Ph.D. chemist and one of Concordia's founders, the company was formed early last year after he and colleagues were approached about developing FTS by a university that held a patent on the compound. An earlier effort to develop FTS by Thyreos, a private company in Newark, N.J., had stalled when that firm faltered, but Bauer's group believed that the drug still held promise.

Bauer knows a lot about developing drugs: He started in the pharmaceutical industry in 1961 and worked his way up to be president of Hoechst Roussel Pharmaceuticals before retiring in 1992. Bauer has done it all, including medicinal chemistry, analytical work, current Good Manufacturing Practices (cGMP) production, and clinical trial management. He believes that he's learned along the way what it takes to bring a new drug through early development, through clinical trials, and to market.

Although Bauer declines to go into detail about how FTS works, public information shows that it inhibits cancer by hindering the disease's ability to replicate defective cells. It does so without killing normal cells and thus promises to avoid the adverse side effects associated with anticancer treatments like chemotherapy.

When Concordia licensed the drug last year, Bauer says, it had a practical synthesis and had undergone extensive biological testing in cancer cells. Ricerca had done some of this earlier work, and Bauer was impressed by it, so he met with the company's chief executive officer, Thomas Bradshaw, about continuing the relationship.

Ricerca was founded in 1987 as a spin-off of the chemical maker Diamond Shamrock. It was acquired by Japan's Ishihara Sangyo Kaisha in 1990 and then purchased by two investment firms, SG Capital Partners and Venture Biologics, in January 2000.

At the time, Bradshaw was one of Venture Biologics' founders and Ricerca was mainly a provider of contract services to the agrochemical industry. Underlying the purchase, Bradshaw says, was the expectation that Ricerca's services could be expanded to pharmaceutical customers. Then, when Ricerca's CEO, Prabhavathi Fernandes, left in April 2003, Bradshaw stepped in as interim CEO. He's still on the job.

Today, Ricerca employs about 200 people, including more than 150 scientists, most of whom are based in three buildings on a 43-acre site in Concord, Ohio. Bradshaw says his company has worked with more than 200 customers, mostly biotechnology firms, in the past few years.

Ricerca is fairly unusual in the contract services sector in that it offers both chemistry and biology. On the one hand, it can provide medicinal chemistry, process chemistry development, and cGMP scale-up. On the other, it also offers toxicology and pharmacology, bioanalytical services, in vitro drug screening, and metabolism testing.

Although Ricerca rarely offered both chemistry and biology services to individual customers five years ago, that has changed. In 2004, Bradshaw says, more than a third of the company's revenues came from customers that purchased from both sides.

Concordia, with no laboratories of its own, is one such customer. Bauer says he and his partners chose Ricerca as an outsourcing house because they liked what they saw the company do for Thyreos and the university, but he says they have stayed with Ricerca because of the breadth of services it could offer.

Bauer adds that he enjoys the direct access he has to chemists, biologists, toxicologists, and other scientists at Ricerca. "I can call them at any time, "he says, "and they all know my name."

AFTER THE TWO firms hammered out a contract early last year, the first service Concordia sought was a comparison of earlier favorable intraperitoneal tests--which involve injecting the drug into an animal's stomach lining--with oral dosing tests, since Bauer and colleagues only wanted to advance an oral drug. "We passed on the first shot," he says.

Next, Ricerca tackled the synthetic route to the drug, taking an already workable synthesis and, as Bradshaw says, developing an alternative route that has high productivity and better scalability. Ricerca also synthesized potential metabolites and degradation products of the drug.

While this chemistry work was proceeding, Ricerca conducted animal toxicology studies, which are almost completed; absorption, distribution, metabolism, and excretion studies, also almost done; and pharmacology safety profiles. All in all, Bauer says, "They are handling the biological and chemical aspects of what we need for an IND," an Investigational New Drug filing with FDA.

Bauer says Ricerca should complete its final pre-IND project for Concordia within the next month, and he is counting on making the IND filing by year-end. After that will come roughly 18 months of Phase I clinical trials of drug safety and then two or so years of Phase II trials of the drug's efficacy against a specific cancer.

During clinical trials, Ricerca's biology role will diminish, and it will function primarily as a provider of cGMP quantities of FTS. Ricerca doesn't offer commercial bulk drug production, Bradshaw says, and its customers typically switch to a commercial manufacturer between Phase II and Phase III trials. Ricerca has informal alliances with two of these, and he says Ricerca is in negotiations with another firm that could lead to a more formal relationship.

Concordia, of course, is years from needing to pay for commercial production of FTS. To date, the company has paid for the drug's development through funds from its partners, some of whom, Bauer says, "have been very successful with what they have done before." However, the company will no doubt need external investors to begin clinical trials. Indeed, one of Concordia's few public appearances was at January's Florida Venture Capital Conference.

Bauer says he prefers to keep a low profile until the IND filing is complete. Concordia has some other new drug opportunities in the same chemical class as FTS, but Bauer says his 40 years of industry experience tell him that the company's focus should stay largely on its lead compound. "I've seen too many biotech companies do a lot more than they could possibly do and squander their resources--both people and money," he says. "We're not going to do that."