Genesis pipped at post in race to offer psoriasis drug

By DANIEL RIORDAN

An American company is poised to launch a new psoriasis drug on the US market, taking some of the gloss off Genesis Research & Development's flagship drug PVAC.

Biogen has won the backing of the US Food and Drug Administration's expert panel for its drug Amevive, designed to treat moderate to severe psoriasis, the skin condition Genesis' flagship product PVAC is aimed at.

The FDA is expected to follow the recommendation of the panel and grant approval for commercial sales of Amevive by the end of the year.

Genesis is to begin a second round of phase II trials of PVAC after delays because of manufacturing problems in the United States. It will be 12 months before the full results are known.

If PVAC makes it to phase III, those trials will take a further 12-18 months and it will be late 2004 before PVAC's viability is known.

Genesis corporate services head Stephen Hall maintains Biogen's breakthrough will have little impact on Genesis, saying Genesis had always been aware of other psoriasis treatments further ahead in the product pipeline.

He said a recent Deutsche Bank study refuted the traditional belief in the benefit of being first to market.

Hall said PVAC was significantly different from most of the other psoriasis products in development, including Amevive. It had a high safety profile and was administered through orthodox injection rather than intravenously, which posed quality-of-life issues for patients.

"There are big question marks on some of them as to their side effects and safety indications, so even if they get approved, we still feel there'll be a very big segment of the market available to us," said Hall.

In the US alone, psoriasis affects about 5.5 million people, about one million of them with moderate to severe conditions.

Fund manager Stephen Walker, who holds a less than 5 per cent stake in Genesis through Walker Capital Management, said Amevive's approval was good and bad news for Genesis.

He said expectations of competing products being on the market by the time PVAC made it that far had been factored into PVAC's estimated market share.

The good news, said Walker, was a resurgence of interest in biotech companies, which could have spin-off effects for Genesis.

The US biotech market rallied on news of Amevive's FDA approval last Friday, following setbacks for companies trying to win regulatory approval for their drugs, including those for treating psoriasis.

One of those setbacks was for another psoriasis drug, Xanelim, developed by US biotech companies Genentech and Xoma. The two companies said last month that Xanelim's development would be delayed because they could not make consistent batches of the drug.

Genesis shares fell 3c yesterday to $2.85.