August 27, 2012 7:33 pm
This article is provided to FT.com readers by BioPharm Insight—a news service focused on providing insight into the most price sensitive issues in the global pharmaceutical market. www.biopharminsight.com
Repros Therapeutics (NASDAQ:RPRX) will need to resolve potential patent conflicts around Androxal (enclomiphene) for male secondary hypogonadism (low testosterone) before it can secure a partner, according to lawyers interviewed by BioPharm Insight. The company will likely have to negotiate a deal with the original patent owner, rather than proceed to district court litigation, they agreed.
Repros did not respond to a request for comment.
Androxal restores and normalizes testosterone levels in men who are deficient. Repros is moving the drug into Phase III US trials and could potentially file for US approval by the end of 2013, for market entry by early 2015, according to company reports.
Testosterone-replacement therapy is one of the fastest growing drug markets. Current testosterone gel market leaders include Abbott’s (NYSE:ABT) Androgel, Auxilium’s (NASDAQ:AUXL) Testim and Eli Lilly’s (NYSE:LLY) Axiron.
The testosterone gel market is also starting to go generic in 2015, according to BioPharm Insight data Androxal’s oral administration and sperm-count preservation ability are clear market advantages over current options, several experts told BioPharm Insight.
Androxal versus clomiphene
Androxal is a trans-isomer of a generic compound, called clomiphene, that comprises (cis) - zuclomiphene and (trans) -enclomiphene. Clomiphene is approved to treat female infertility.
Repros has patented a purified form of clomiphene (removing zuclomiphene) for the treatment of testosterone deficiency in men, according to company financial documents.
Repros, however, finds itself potentially conflicting on Dr. Fisch’s existing patent for clomiphene used in “methods of treating androgen deficiency in men.” Fisch filed the patent (6391920) in October 2001, and if Repros proceeds to launch Androxal, it could be infringing on Fisch’s patent and liable for triple damages, patent lawyers agreed.
According to Repros’ financial statements and patent filings, the company requested re-examination of Fisch’s patent at the US Patent and Trademark Office (PTO) in January 2004. After an unsuccessful first attempt, the company requested a second re-examination in May 2006, challenging Fisch’s patent in light of additional academic prior-art publications.
Whilst the request was granted and Fisch’s patent infringement claims were initially rejected by the PTO, he appealed the decision and the rejections were reversed on several claims. This decision was rendered by the US Federal Circuit on December 2011, and a re-examination certificate is expected to be issued confirming the patentability of these claims, according to the company statement.
Repros’ current standing
Repros publicly stated in a financial document, “if such a re-examination certificate were to issue, we believe that our development of Androxal would not infringe any of the remaining claims and that all of the remaining claims are invalid on various grounds including additional prior art publications.”
Fisch said a small portion of clomiphene patent claims that were still rejected by the PTO are not related to Repros’ Androxal. Lawyers highlighted that whilst Androxal’s “development” is indeed infringement free as the company suggests, should the company choose to commercialize the product, it would be infringing upon Fisch’s patent.
It appears from these PTO re-examinations that Repros cannot come up with publications that invalidate Fisch’s claims, said a US patent lawyer. Whilst the second party, in this case Repros, can often get a patent on a modification of the concept, it does not give them the freedom to practice this modification given the generic prior patent, he added.
Settlement the more likely option
The company could defend itself in district court litigation proceedings in a patent infringement suit; however, this process would be lengthy and expensive for both parties (several millions), and the more advisable option would be to settle out of court, said the patent lawyer and Susan Dadio, president, The Bar Association of the District of Columbia.
The more times a patent goes through re-examinations and remains in force, the less confident the challenger (Repros) should be feeling, said Colin McCall, senior associate and intellectual property (IP) laywer at Taylor Wessing, UK. He added there will be risks in taking this further in legal proceedings.
Isomer cases are not uncommon, and whilst Repros holds its patent on Androxal, it still has to answer to the generic patent holder’s claim should it choose to market the drug, McCall noted.
Fisch holds his patent for 20 years after its filing date (until October 2021), and if Repros were to wait for this patent to expire, a launch would be delayed by potentially six years, said a second lawyer specializing in US drug development.
If Fisch does not intend to commercialize the product himself, it would make sense to settle and monetize on his position, added the US patent lawyer.
As there is no guarantee the product will succeed Phase III trials and/or gain regulatory approval, Fisch would want to negotiate a healthy upfront fee with additional milestone and royalty payments on any potential future sales, said McCall. The patent lawyer said the royalty factor could range from a standard 3% to 20%.
When asked if there was a possibility of settling with Repros or a potential collaboration with the company, Fisch declined to comment and said he was “currently exploring all options.”
Analysts have predicted a potential market opportunity exceeding USD 1bn for Androxal.
These unresolved patent issues are the likely reason for Repros not securing a partner given the risks involved, said McCall. A partner would want this dispute completely settled before making any commitment to the program, added Dadio.
In March, Repros’ CEO Joe Podolski told this news service the company was hoping to secure a development and commercialisation partnership for Androxal before starting Phase III trials. The company expected a May US Food and Drug Administration (FDA) Phase III meeting to catalyse term-sheets for a deal. The company has now confirmed it will initiate Phase III trials on its own while it continues partnership discussions.
The FDA meeting and issue of a Special Protocol Assessment (SPA) resulted in a share price rally that more than doubled its original market cap of approximately USD 63m.
Repros has a current market cap of USD 132m.
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