KRAKOW, Poland—Selvita and Orion Corp. of Espoo, Finlandhave entered into a global collaboration to jointly develop and commercializeSEL103, Selvita's proprietary program for the treatment of Alzheimer's diseaseand other cognitive disorders.
Selvita will be responsible for the discovery and earlypreclinical development of small molecules, and Orion will take over thepreclinical and clinical development as well as further commercialization afterthe selection of a lead compound.
The agreement provides for an initial upfrontpayment to Selvita from Orion, as well as research funding and additionalmilestone payments based on the success of the development of the compound inmultiple cognitive disorder indications. Orion will have global commercializationrights.
Financial details of the agreement were not disclosed.
"The joint program with Selvita matches well with ourstrategy of entering into early stage collaboration with partners havingcomplementary skills to our own," says Dr. Antti Haapalinna, Orion's vicepresident of research. He notes that representatives of the two companies metat a Bio Europa meeting in spring 2009 and agreed that the SEL 103 program wasa good fit.
As is the case with Selvita, Orion's partners tend to besmaller companies with special expertise and resources. In this case, theprogram will combine the resources of Orion's experienced CNS research anddevelopment team with Selvita's competencies in discovery chemistry and biologyassays. Pursuing similar strategies, Orion has developed seven new chemicalentities, which is a solid track record for a mid-size European company,Haapalinna notes.
"Our most successful products include Comtess, Comtan andStalevo, commercialized in collaboration with Novartis," Haapalinna says.
"Selvita is a young company, lacking clinical developmentexpertise and adequate financial resources, and we knew we needed to work witha strong partner to take full advantage of our research in Alzheimer'sdisease," observes Pawel Przewiezlikowski, Selvita CEO. "Orion's Parkinson'sdisease treatment, Stalevo, allowed them to build strong clinical trialexpertise in the elderly population, which can also benefit most from our drug.The Orion behavioral assay facility in Espoo is one of the best equipped labsin the world."
The Orion Group's net sales in 2009 were $358 million. Thecompany invested $126 million in research and development.
In the three years since its founding, Selvita has grown toalmost 100 scientists. This growth and expectations for future growth, incomeand eventually, profitability, are based on the yet unexplored potential ofPolish science, Przewiezlikowski says.
"Poland is one of the 20 largest economies in the world, andthe fastest growing in Europe," he says. "The IT outsourcing industry isalready mature and the pharmaceutical research outsourcing is starting tobloom. We have 80,000 people in biomedical research, yet very few innovativebiotechnology companies and few contract research organizations. So Selvitatakes advantage of numerous academic collaborations and is able to recruit thebest graduates, experienced candidates from Poland and returnees. We have ahybrid business model—70 percent of our scientists work in collaborativeprojects and 30 percent on our internal programs. In the contract researchbusiness, we rely on high level of our scientists' expertise, strong IPprotection and cost advantages. We doubled our revenues in 2009; expect to growto around 200 people in 2011 and to complete our first Phase I study with SEL24in 2013. The profitability of the company will highly depend on the risks thatwe will decide to undertake with our own internal programs."
Alzheimer's disease is the most common cause of dementia.Treatment is a very large unmet medical need, so each new therapy has a verysignificant market potential, Przewiezlikowski notes.
"The current market leader, Aricept from Eisai, had sales ofaround $3.5 billion in 2009," he observes. "But we are speaking now about apreclinical program with a potential market launch in the 2020s, so I would notlike to speculate on the potential revenues from SEL103. We are now fullyconcentrated on bringing the best possible compound to the clinic."