Defying the odds, Poxel plots a PhIII course for its Type 2 diabetes med and shares surge on new data

Thomas Kuhn, Poxel

Poxel is trying to master one of the toughest acts in biotech: Develop a new drug for Type 2 diabetes and win a regulatory approval — on its own.

It’s not easy, in the way that navigating a mine field isn’t easy. But they are moving ahead and say they have a very manageable game plan for getting through Phase III in Japan while looking for partners that can do much of the heavy lifting in Europe and the US.

About 10 months ago, France’s Poxel hit the brakes on a planned move to Nasdaq, unable to generate much enthusiasm in a tough market. Instead, execs raised some additional cash from its public listing in Europe to fund a Phase IIb trial of its lead therapy for Type 2 diabetes that would hopefully pave the way to a launch in Japan.

Today, the company says it scored the primary and at least one secondary endpoint for imeglimin, tracking hemoglobin A1c reductions of 0.52%, 0.94% and 1.00% for the 500 mg, 1000 mg and 1500 mg dose twice-daily. Seven percent or less is the key number for glycemic control. The drug also triggered a statistically significant drop in fasting plasma glucose. And now the company plans to set the stage for a pivotal program in Japan that can launch later this year — provided Japanese regulators sign off.

That was welcome news to its investors, who bid up shares {$POXEL: PA} by more than 35%. But the biotech has a long way to go before it can declare victory.

Late-stage testing for a diabetes drug, which would be steering into an intensely competitive market among a handful of giants in the field, is neither easy nor cheap. Big Phase III budgets needed to sufficiently test a mass market drug have scuttled earlier contenders like Phenomix (RIP: 2010). MannKind struggled its way through the clinic to end up with an inhaled insulin that diabetics — and after Sanofi washed its hands of a deal, the rest of the players — have shunned. And none of that has made diabetes particularly popular with VCs or generalist investors.

But Poxel execs say they have found a path that can work.

“For a biotech company like this accessing this market (Japan) is much easier,” CEO Thomas Kuhn tells me. While most global biopharma companies prefer to hand off their drugs to Japanese partners better equipped to work with the country’s regulators, Poxel created their own local team in the Asian country, and Kuhn says the country lowered regulatory barriers to outside companies a couple of years ago, making it possible for Poxel to pioneer this on their own.

But there are even more important aspects that make Japan one of the few places on the planet Poxel could expect to do this on their own. One is that regulators are open to new drugs in the field, Kuhn argues, sensitive to the issues Japanese patients have with metformin. Poxel could get an approval on a slate of three studies involving about 1,000 diabetes patients in Japan, says the CEO, while it would ultimately take some 7,000 patients in the US. Japanese patients are also much leaner than the average US patient, avoiding the necessity of a cardio outcomes study in advance of an approval. And finally, he notes, as a Merck Serono spinout, they have the kind of expertise necessary to make it all happen.

Poxel still says it would need a Japanese partner to commercialize the drug, but that’s something that Kuhn feels is doable, given the number of global and local companies that work in the market — which he says is the second largest in the world.

The biotech has also completed Phase II studies in the EU and the US for the drug, which targets mitochondrial dysfunction. So the company can continue to parlay with Japanese regulators as they work with contacts in the US and Europe for those bigger markets. And a Nasdaq IPO remains an option, when the time is right.

That may not be easy. But the way Kuhn says it, it doesn’t sound impossible either.

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Research Scientist - Immunology
Recursion Pharmaceuticals Salt Lake City, UT
Director of Operations
Atlas Venture Cambridge, MA

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