Glaxo Veteran Directs Infirst’s Jump Into Differentiated OTCs
This article was originally published in The Tan Sheet
Executive Summary
U.K. biotech SEEK launches infirst HEALTHCARE to focus on commercializing consumer products, while the firm’s pipeline continues developing. Former GlaxoSmithKline exec Manfred Scheske leads infirst as it prepares cough remedy and analgesic launches in multiple markets.
U.K. biotech SEEK is moving forward with relatively quick-to-market OTC opportunities while nurturing a pipeline of molecules for immune system activation and regulation.
Though start-ups commonly spin their wheels in the pre-revenue stage for years, SEEK executive Manfred Scheske looks to exercise the OTC commercialization and marketing skills he honed while leading GlaxoSmithKline Consumer Healthcare LP in North America and Europe.
Scheske left Glaxo in September 2010 to join SEEK, then called PepTcell, and became CEO of its new consumer health care subsidiary infirst HEALTHCARE July 9 (Also see "GSK Consumer Vet Scheske Sees OTC Potential In Biotech PepTcell's Portfolio" - Pink Sheet, 18 Oct, 2010.). The London-based firm also announced plans to launch established OTC cough suppressant and analgesic ingredients with formulation twists in multiple markets.
Manfred Scheske
Photo courtesy of SEEK
While the products are based on well-known, ubiquitous ingredients, they will be differentiated on the retail market, said Scheske.
“The products are different, they look different,” he said, adding, “We are very confident that they will make a difference in the marketplace.”
SEEK intends to leverage the revenue stream from its near-term OTC launches to attract up to $40 million in external investments. Scheske said the additional financing will allow infirst to expedite product commercialization and expand its geographic market scope.
SEEK’s overall pipeline is weighted toward Rx compounds, with products in development for breast cancer, cholesterol management, HIV and mosquito-borne diseases.
Cough And Gold
Infirst has out-licensed the rights for its cough suppressant offerings in the U.S. and Canada to Pernix Therapeutics Holdings Inc., which plans to introduce a cough suppressant line using established ingredients – with added cocoa flavoring – by late 2013.
Infirst and Pernix have declined to identify the active ingredient in the forthcoming products, though infirst has intellectual property surrounding cocoa-flavored cough medicine.
Cocoa-flavored OTCs “didn’t sound like a big idea,” Scheske admitted. “But the more we asked consumers about this, the more we heard, ‘That is a big idea. A much bigger idea than you thought.’”
Health sciences investment firm Aisling Capital bought a minority stake in Pernix in 2011 and helped nudge The Woodlands, Texas-based specialty pharma company toward the OTC cough category. Aisling managing partner Steven Elms, now a Pernix director, previously was chairman of Adams Respiratory Therapeutics Inc., the original sponsor of Mucinex. David Becker, appointed Pernix’s chief financial officer in December 2011, served as CFO at Adams before its acquisition by Reckitt Benckiser Group PLC.
Aisling’s recognition of the attractive OTC cough remedy space is “something that we certainly appreciate, because it also represents a pre-validation of that part of our portfolio,” Scheske said.
SEEK’s licensing deal with Pernix, inked in May, brought it $5 million upfront as well as the promise of royalty and milestone payments from Pernix after the products hit retail.
SEEK retains the rights to its cough portfolio in the rest of the world, and continues developing theobromine, a cocoa-derived alkaloid, as a potential first-in-class cough/cold/sinus/allergy treatment. The ingredient is in a phase III clinical trial and Scheske said he expects the firm to launch a theobromine product in Europe by 2014.
Worldwide cough remedy sales jumped 9.2% last year to $5.32 billion, while U.S. sales in the category grew 2.3% to $954 million, according to market research data from Euromonitor International.
Getting The Oil Treatment
Outside the cough arena, infirst is applying a novel platform of plant oil infusions to OTC analgesics; the first to be commercialized will be ibuprofen.
Formulating the actives with a mixture of linseed oil, rapeseed oil and other excipients has the potential to make the drugs more tolerable and gentler on the stomach for certain consumers, Scheske said, though the company does not intend to pursue any unique labeling claims for the products.
PLx Pharma Inc. is pursuing a similar tack with a new drug application for aspirin in a lipid coating, designed to be more tolerable to the gastrointestinal tract (Also see "PLx Pharma Proposes “GI-Safer” OTC Aspirin In New Drug Application" - Pink Sheet, 28 May, 2012.). PLx also has its own connection to Adams: former Adams CEO Michael Valentino serves as chairman of the PLx board.
“I think OTC has to be more creative now, with regard to bringing news to a wide patient population, and cannot rely on this coming from switches.”
– Manfred Scheske
SEEK possesses IP around its plant oil excipient formulations, which Scheske said also could serve as a platform for Rx treatments, such as cholesterol management and hormone therapy.
Even though Scheske has responsibility for commercializing SEEK’s consumer health products, he does not draw a line of demarcation between the Rx and OTC worlds, especially given the firm’s international ambitions and the variable OTC regulations and designations from country to country.
He also believes the OTC industry should follow infirst’s lead in being more innovative in product development if it is to overcome a reliance on Rx-to-OTC switch. Scheske points out switch is inherently more difficult now than a decade ago as top-selling Rx drugs largely have shifted from primary care to the specialty care arena.
“The future of switches, just because that portfolio is drying out, looks pretty dim,” he said. “I think OTC has to be more creative now, with regard to bringing news to a wide patient population, and cannot rely on this coming from switches,” Scheske added.
FDA is exploring the potential of extending the nonprescription drug paradigm into new areas under expanded conditions of safe use, which many pharma industry stakeholders believe could aid novel switch programs (Also see "FDA Execs Prefer Novel Switch Model Sans Intervention" - Pink Sheet, 21 May, 2012.). However, Scheske opined that self-care simply does not lend itself to treating asymptomatic conditions.