Small, but mighty

ATLANTA—With their eyes focused on developing a long-lasting treatment for diabetic macular edema (DME), Alimera Sciences Inc. and pSivida Ltd. announced last month an amended license and collaboration agreement relating to Medidur FA, the companies' Phase III investigative treatment for DME.

According to the amended agreement, Alimera, an ophthalmic pharmaceutical company, has increased its equity in the future profits of Medidur from 50 to 80 percent in exchange for consideration of approximately $78 million to pSivida, a global drug delivery company.

Consideration to pSivida includes an up-front payment of $12 million, a $25 million milestone payment upon FDA approval of Medidur, other payments of up to $21 million by September 2012 and assumption of pSivida's $20 million research and development funding obligations.

Dr. Ken Green, senior vice president of scientific affairs at Alimera, says the agreement allows Alimera to increase its stake in and consolidate the development and commercialization of Medidur.

"We were in a financial situation where we could acquire a larger part of the technology," Green says. "The progress in clinical trials has been excellent, and we're happy to be able to take it, develop it and bring it to market."

Dr. Paul Ashton, managing director of pSivida, says the deal eliminates pSivida's need for equity financing under its current plans.

"The new agreement provides immediate and near-term funding to pSivida and eliminates our obligation to share in development costs, significantly reducing the risk of the Medidur program to pSivida, while giving pSivida a significant interest in the profits," Ashton says.

Currently, there are no FDA-approved drug treatments for DME, the leading cause of vision loss for people under the age of 65. The condition is a common complication of diabetic retinopathy caused by fluid build-up in the central vision portion of the retina. The only approved method for treating DME involves laser photocoagulation therapy, which can leave irreversible blind spots.

Focused on delivering a less problematic treatment to the market, the companies are engaged in a Phase III clinical trial for Medidur, a tiny, injectible device designed for the sustained release of the drug fluocinolone acetonide. Injected into the back of the eye with a 25-gage needle, the implant—which Ashton said is "about the length of an eyelash"—releases a constant amount of drug for 18 to 36 months.

"The 25-gage injection system is advantageous because it leaves what is called a self-sealing wound," Green says. "That's an issue out there for other systems out there that use larger gage needles, and certainly, for an in-office operating procedure, that is an important consideration. We also think the Medidur system is really optimized to deliver the steroid because the release kinetics of Medidur has almost no burst at all and is a slow release."

Green says Alimera will further advance the delivery system's application in other serious ophthalmic conditions like dry age-related macular degeneration (AMD).
Ashton also notes that pSivida has a licensing and funding agreement with Pfizer for additional ophthalmic applications of Medidur. The Pfizer deal provides for up to $165 million in equity investments, development and sales-related milestones plus R&D funding. Once commercialized, pSivida will receive sales-based royalties.

"This new agreement with Alimera is expected to significantly reduce our burn rate going forward as the company's two lead ophthalmology programs in development are now funded by our partners," Ashton says. "This deal gives us the resources to develop other products in our pipeline. In addition to the Pfizer and Alimera deals, there are several ophthalmic and non-ophthalmic applications we are advancing. Strategically, we are well positioned to capture a significant share of the large and expanding back-of-the-eye market."