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Pharmaxis Ltd gets approval to sell Bronchitol® in largest market yet, Russia

Published: 10:00 27 Sep 2016 AEST

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Pharmaxis Ltd (ASX:PXS) has achieved a major milestone by gaining the approval for marketing of its drug Bronchitol® in Russia, the largest market accessed to date for the drug.

Bronchitol is delivered using a portable inhaler and will be used to treat cystic fibrosis (CF) in children and adults.

Last year’s CF market to deal with mucus clearance in Russia was worth US$29 million.

First sales are expected before the end of 2016.

Gary Phillips, CEO, commented: “This is an important milestone for the company and a noteworthy achievement for Australian innovation.

“Bronchitol will be manufactured and exported to Russia from our purpose-built factory in Sydney.”


Background


Pharmaxis is a pharmaceutical research company with a portfolio including two respiratory products, Bronchitol and Aridol, approved and sold in various world markets.

It also has a research pipeline focused on areas of high unmet clinical need in inflammatory and fibrotic diseases founded on its expertise in the chemistry of amine oxidase inhibitors.

This expertise has attracted interest from leading pharmaceutical companies looking to make acquisitions or partner in this rapidly expanding area of medical need.

In May 2015, Boehringer Ingelheim acquired the Pharmaxis phase 1 investigational drug PXS-4728A.

This involved an upfront payment of €27.5 million and a total potential deal value of over A$750 million.

Boehringer is due to pay another milestone when they commence a phase 2 trial expected in 2017.


Russian entry


There are circa 7,400 CF patients on the Russian Cystic Fibrosis Registry, but it is estimated that between 3,000 and 6,000 CF patients living in rural regions not currently included on the registry.

Russia’s Ministry of Health Orphan Committee will now consider Bronchitol’s application for reimbursement under the country’s program for guaranteed funding of seven orphan diseases known as the 7 Nosologies Program. 

CF drugs are purchased by the Russian Ministry of Health by way of an annual tender.


Analysis

Entry into the Russian market for Bronchitol is a significant achievement for the company as it looks to expand the drug’s customer base and increase its potential to generate revenue.

This demonstrates both the clinical research and commercial expertise as Pharmaxis has now translated an Australian clinical discovery into an approved therapy for patients in the E.U., Australia and now Russia.

The entry into Russia also shows the potential new CEO Gary Phillips can unlock for Pharmaxis given his past experience and relationships in Eastern Europe.

Entry into the Russian market continues momentum for Pharmaxis, most recently spurred by a takeover in the liver disease (NASH) space valued up to US$1.7 billion.

Pharmaxis has already sold a drug to treat NASH to Boehringer Ingelheim in May 2015 and is working on a second drug that inhibits LOXL2 as a way to treat more severe NASH.

The recent takeover activity has created a surge in share prices amongst the publicly listed NASH space with a number of NASDAQ listed pharmaceutical companies rallying.

Pharmaxis has received strong interest from large pharmaceutical companies with regard to the LOXL2 program.

The share price is up 7.5% intraday, currently trading at $0.285.

 

Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX emerging companies with distribution in Australia, UK, North America and Hong Kong / China.

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