Insmed: Meeting Milestones!

Insmed (Nasdaq: INSM) provided a status update on their development program.

• After recently receiving approval form the UK Medicines and Healthcare Regulatory Agency to initiate a clinical trial for INS-19 [a follow-on biologic of Amgen’s (Nasdaq: AMGN) Neupogen®] patient screening has begun and the first dosing is expected next month with similarity data to be reported in June.

• INS-20 [a follow-on biologic of Amgen’s (Nasdaq: AMGN) Neulasta®], Insmed’s second follow-on biologic candidate completed pre- clinical pharmacological and pharmacokinetic studies, and plans to initiate clinical studies 4Q08.

• A Phase II study of IPLEX™, a complex of recombinant human insulin-like growth factor-I and its binding protein IGFBP-3, in Myotonic Muscular Dystrophy has been initiated and received IRB approval and is actively recruiting patients with enrollment north of 50% remains on target to complete enrollment in 1H08 with interim data analysis expected

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Insmed Gets First FOB Clinical Study Greenlight!

An important milestone for Insmed (NASDAQ: INSM), developer of follow-on biologics and biopharmaceuticals, was achieved in the form of approval from the UK's Medicines and Healthcare products Regulatory Agency to initiate their first clinical study for INS-19, a follow-on biologic product candidate. INS-19, is a recombinant form of human G-CSF, is a follow-on biologic of Neupogen®. Amgen (NASDAQ: AMGN) booked 2007 sales of Neupogen® that approached $900M, and the patent expires in 2013.

The Phase I study will be conducted in the UK and will compare the safety and establish the bioequivalence of INS-19 to Neupogen®. Results from the trial are expected in 2H08, and are planned to be used as part of a submission to the FDA to establish a protocol with the agency for a Phase III trial in the U.S.

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Insmed: A Going Concern…

It is often a challenging path to be first to market. Insmed (NASDAQ: INSM) is blazing that trail via their aim to be the first US-based biotechnology company to develop a comprehensive portfolio of Follow-on Biologics (FOBs). From my understanding, one such challenge the company faces is that no regulatory pathway currently exists for FOBs, which are also commonly referred to as biosimilars or biogenerics, in the US, though a regulatory system for approving FOBs was established in Europe in 2006. As many a successful company in the life science space has done is avoid being a one-trick pony by diversifying the product portfolio. Insmed subscribes to this asset diversification strategy with incorporation of their proprietary protein platform (say the five times) that focuses upon niche markets with unmet needs.

Insmed announced, in order to remain compliant with NASDAQ rules and regs, a going concern audit opinion was submitted with the most recent 10K SEC filings. This going concern audit opinion was given because the Company’s ability to continue as a going concern is dependent upon its ability to raise capital through securities offerings, debt financing and partnerships to fund on-going operations. Since mid-December 2007 the share price has been trading below $1.00 thus setting off various warning bells.

Interestingly the London-based I-Bank Collins Stewart (which many of you Coloradoan’s may recall acquired C.E. Unterberg Towbin in 2007 who had offices in LoDo) has begun coverage of Insmed and issued this valuation not two weeks ago…

By applying a 6-7x multiple to our 2012 revenue forecast of $88.7MM and discounting back at a rate of 20% per annum, we arrive at a fair value for INSM shares of $2.

I am most interested to hear if Collins Stewart has any direct or indirect relationships with Insmed and if not then why then have they initiated coverage and their BUY recommendation? Collins Stewart covers a number of other public companies with Colorado roots or ties including Allos Therapeutics (NASDAQ: ALTH), Array Biopharma (NASDAQ: ARRY) and OSI Pharmaceuticals (NASDAQ: OSIP).

With Insmed’s cash position as-of 31 December 2007 at approximately $16.5M combined with the planned initiation of clinical trials this year for INS-19 and INS-20 [generic versions of Amgen’s (NASDAQ: AMGN) Neupogen and Neulasta] combined with ongoing Phase II enrollment for the proprietary IPLEX™ asset myotonic muscular dystrophy study, at least IMHO the current cash position does not compute with ongoing needs.

Just an interesting aside…if I am not mistaken the Insmed manufacturing facility in Boulder is across the street from the Amgen site…hmmm?

So, it is unambiguous that there is continuing developmental risk here if a financing event in the form of debt, equity or partnership is not achieved, I would venture to guess based-upon an anticipated ramp in quarterly burn, some time this year. Let’s keep our fingers crossed that management is able to get a deal done and soon!

*NOTE* Feel the power of the Colorado BioScience Association (HERE)!
*NOTE* Take a look at the new Boulder Biotech Company Tree (HERE)!
*NOTE* Read the new eBook CLSDF 2007 - What's In A Year? (HERE)!

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Insmed and Colorado Manufacturing

Another question for today…What do Amgen (NASDAQ: AMGN) and Roche (VTX: ROG.VX) have in common with Richmond, VA-based Insmed (NASDAQ: INSM) and Columbia, MD-based Martek Biosciences (NASDAQ: MATK)? Answer…they too have their state-of-the-art FDA-approved biologic commercial manufacturing facilities in Boulder. I find it interesting how Colorado is emerging as an unambiguous center of excellence in the manufacture of small molecules and biologics. Please leave some comments below as to why you think this trend is emerging.

Insmed specializes in the development of drugs to treat metabolic diseases, endocrine disorders, and oncology. Its lead product candidate IPLEX™, a recombinant protein product candidate, is in Phase II clinical trials for the treatment of myotonic muscular dystrophy, the common form of adult-onset muscular dystrophy. It is also conducting a Phase II clinical study for investigating IPLEX™ as a treatment for HIV associated adipose redistribution syndrome; a Phase I clinical study investigating IPLEX™™ as a treatment for retinopathy of prematurity, a disease where the small blood vessels in the back of the eye and the retina grow abnormally; and an expanded access program in Italy to provide IPLEX™ to physicians for patients with amyotrophic lateral sclerosis, a neurodegenerative disease that affects nerve cells in the brain and the spinal cord. In addition, Insmed is developing INSM-18, a small molecule tyrosine kinase inhibitor that is under Phase I/II clinical trials for the treatment of breast, lung, pancreatic, and prostate tumors; and rhIGFBP-3, a Phase I clinical product candidate for the treatment of breast, prostate, liver, ovarian, and colon cancers. The company has license and collaborative agreements with Fujisawa Pharmaceutical Co., Ltd. to use IGF-I therapy for the treatment of extreme or severe insulin resistant diabetes; and a license to Pharmacia AB's portfolio of regulatory filings pertaining to rhIGF.

Just this week Insmed was granted Orphan Drug Designation for IPLEX™ for the treatment of Myotonic Muscular Dystrophy (MMD). Insmed is currently conducting a 24-week Phase III enabling trial for IPLEX™ in MMD, and recently was awarded a grant of approximately $2.1M from the Muscular Dystrophy Association which will be allocated to trial costs.

More on Martek coming soon...

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