Codexis weighs into generics biz via India
sales of high-value generic pharmaceutical intermediates, to be
sold into unregulated markets for use in patented drugs.
"Today marks Codexis' transition from being simply a technology platform company to being a product company," Dr Alan Shaw, president and CEO of Codexis, told a press conference at the annual CPhI show in Paris last week.
"When we were just a technology platform company we were basically giving the value of our company away in licensing deals which made lots of money for pharmaceutical companies but little returns for us."
Shaw said that the company has decided to seize upon the value of its unique platforms, including its Smart Synth integrated chemical process development and WG Shuffling strain engineering technology, that can create biocatalysts - either enzymes or fermentation strains - that improve pharmaceutical process development.
According to the firm, these biocatalysts can shorten process development timelines, dramatically improve existing manufacturing processes and increase chemical development productivity, resulting in the cost of goods being reduced by 40 to 70 per cent and capital expenditures reduced by over 35 per cent.
"In the generics market, where the cost of goods can be as high as 50 per cent, these cost savings can mean life or death for a company," said Shaw.
Codexis is starting its intermediate production at the top with ATS-8, the key chemical intermediate in atorvastatin, the active ingredient in the world's largest-selling drug for lowering cholesterol - Pfizer's Lipitor.
"ATS-8 heads a deep pipeline of pharmaceutical generics in high growth markets with significant gross margins," said Shaw.
"The generic active pharmaceutical and intermediate market potential for our company is currently $7bn and the potential for generic Lipitor alone is $500m."
The company is now working on intermediate manufacturing processes for half of the top 40 drugs that will come off-patent within the next five years and Shaw calculates that Codexis will be well placed to compete for $67bn worth of global intermediate and API market value, relevant to its targeted platform, that will be off patent by 2008.
In particular, the company's generics portfolio will include intermediates and APIs for infectious disease, cardiovascular and CNS indications, including AstraZeneca's Nexium (esomeprazole magnesium), with expansion planned to a number of other therapeutic categories.
Once Codexis uses its technology to perfect the manufacturing processes for these ingredients - a procedure that takes 18-24 months - the actual commercial manufacturing will then be outsourced to Indian contract manufacturers.
The finished product will then be sold by Codexis' Indian subsidiary, Codexis Laboratories India, first to unregulated markets such as India and Brazil and then into regulated markets when the compound finally comes off patent.
The company is making a point of steering away from Chinese manufacturing partners for the time being due to concerns over intellectual property.
"India's pharmaceutical manufacturing market is more mature and at present the companies are more trustworthy," said Shaw.
An Indian partnership deal is already in place with Arch Pharmalabs for the production of ATS-8 and Codexis said it has already received the first commercial orders for the product from leading generics manufacturers.
The deal for ATS-8 is exclusive to Arch Pharmalabs, however, it is "open season" as far as any future contracts to manufacture any further intermediates," Shaw told In-PharmaTechnologist.com.
"Our business is in high demand in India, we don't go looking for companies to work with as we are inundated with approaches," said Shaw.
"If an Indian company wants to work with us the best thing they can do is just phone us up, the deal may have been done already, but you never know, they might call at the right time and get lucky."
Shaw said Codexis is following a similar business model to rival Indian firm Matrix, who was just bought by US-based Mylan Laboratories last month, and will not move beyond API manufacturing.
"A lot of companies are working on improved processes to make these APIs, the winner will be the one with the best technology," said Shaw.
Shaw believes that will be Codexis, as its platform technology can create new intellectual property opportunities, which can help extend the lifetime of drug products.
"We have patents that no one else has seen that were filed two days ago."
