GTC Biotherapeutics (fka GTCB)

[gym gravity]

MTB

>>For some BP to gamble $200 million to buy GTCB, then to devote $100-125 million to get it through the next 4-5 years, then reap multiple billions of dollars in F. VII, VIII, IX; CD-20, etc sales seems a fairly high probability event. These are low risk biologics, with huge markets that would then have 5-7 years before loss of IP patent protection. If I had the money (and I was just talking with a deep-pocketed VC firm), it makes a compelling story -- even more so given the years of failure to get here.

I felt like looking at up what parts of gtcb could cost, long term, for a Big Pharma, or a government.

for about $50m down they get a staff of people expert in protein purification. (they are hiring, by the way, so either that means someone important left or that they are getting bigger: http://www.gtc-bio.com/about/career.html )

As Dew keeps hinting, it is incredibly difficult to bring a biologic to market, he probably knows how many versions of Herceptin, Rituxan or Avastin never made it to trials.

If bringing FOB's to market isn't going to be any easier time wise than making novel drugs, a GTCB suitor would benefit from deep pockets to do three things:

1) Flesh out the plasma protein portfolio at a steady pace…cost MTB guessed was $100-125m for 4-5 years. Add to that Included in this is whatever else happens on the farm at the capacity of production from 2008.
2) Quickly license or design new antibody drugs with new epitope targets, or antibody subtypes of other targets, from a library like Dyax’s…Dyax gets $5m upfront cash from biogen for their new search together, $85m in milestones I think after that. For a fell swoop buyer of a whole transgenics biologics facility, they would need $5-10m per year to pan for novel drugs, either themselves, or in licensing, because GTCB doesn’t do drug discovery (yet).
3) Start running trials hand over fist at $100m year, a quick estimate at the expenses the farm known as GTCB could incur if it had about 8 drugs in trials at once.

This works if the Big Pharma suitor is starting from scratch and have an existing pile of working cash. The strategy would be to get as many novel biologics as they can into the clinic while they still enjoy patent exclusivity on production, assuming anyone other than existing transgenic producers would be interested in using goats. (11 more years for the milk patent) and 7-10 years to get new ones to market, because as Genzyme has shown, when you switch a bioreactor, it is going to need additional consideration.

So a 1-3yr window between milk patent expiry and time when a competitor can challenge it for sale in countries that care to enforce it, and for the long term, a cost advantage on production of flurry of antibodies. The new company should keep a careful eye at patent expiration in case any of the new pipeline fall under a "biosimilar legislatory" advantage, and have the cash to initiate pre-clinical work on as many novel biologic antibody:epitope drugs, produced and ramped up at efficient prices.

Expect the “late to the biologic party” pharma like Sanofi or Gilead to sign a deal with a discovery company like Dyax soon.

That 1-3year window might not close if only Pharming, Progenetics, LFB and PIP are competitors. 5 companies could slice up the billion dollar transgenic pies or they could merge to 3 or 2 or 1 (GE could come to mean genetic engineering and general electric).

(just wanted to note the genz-dyax-gtcb puzzle pieces seem to fit better sometimes than others)