Pearltrader

Farsight Bioscience aims to use its biotech expertise to evaluate projects and direct its investments. The focus will remain on large potential therapeutic markets. The original idea of taking projects from early stage research and, having added value through further cost-effective development, delivering the projects to large pharmaceutical companies, ensuring the fastest possible transfer of creative ideas into well-founded drug development projects, remains intact. Following the strategic review, the Company has adjusted to the new market realities by adding more emphasis on the shorter term opportunities thrown up by the “credit crunch”.

The Company’s business model continues to look to out-license its portfolio at the stage of early clinical trials. In addition, the Company will now also invest in outside projects that are at a later stage of clinical development but which still fit in with the overall plan to focus on large potential markets. The Board believes that the “credit crunch” has thrown up a lot of very high quality late stage projects that are in financial distress. The Company’s customers will remain primarily other biotech and large pharmaceutical companies. The Board believes that trade sales and licensing are expected to happen after passing significant value inflection points such as completing key clinical trials.

At present, Farsight Bioscience is focused on three main therapeutic areas:

    * Metabolic disorders
    * Cardiovascular disorders ("CVD")
    * Inflammatory disorders

We will cover the three areas in-depth in the following sections.

Metabolic Disorders

Background

Market Opportunity

Treatments

    * Chemokine antagonists
    * Toll-like receptors
    * Melanin-concentrating hormone antagonists
    * Melanocortin MC4 agonists
    * 11β-hydroxysteroid dehydrogenase inhibitors

Cardiovascular Disorders

According to the US Center for Disease Control and Prevention, cardiovascular disease (CVD) continues to be the leading cause of death among both men and women, cutting across all racial and ethnic groups. In the US alone, CVD costs an estimated $300 billion dollars per year in treatment costs, lost productivity, disability and death. Furthermore, U.S. government statistics indicate that approximately $4 billion of unnecessary medical costs are spent each year on the assessment of non-cardiac cases in hospital emergency departments. As the population ages, this unnecessary expenditure is expected to double. In addition to diet and exercise, medication is a key component in the prevention and treatment of CVD. However, despite the numerous cardiovascular drugs currently on the market, there is still significant unmet medical need.

A report issued by GIA about “Cardiovascular Drugs: A Global Strategic Business Report” states that the world market for cardiovascular drugs is projected to exceed $111.8 billion by the year 2015.

Types of CVD
CVD also represents a number of diseases, with the common factor of the cardiac muscle and system – for example:

Hypertension
Hypertension affects approximately 50 million people in the United States and approximately 1 billion people worldwide (NHANES III). Despite the availability of a myriad of pharmacological treatment options, the disease is often poorly controlled even in patients on combination therapies necessitating the search for novel treatment modalities.

Heart Failure
The syndrome of heart failure is viewed as the end-stage of various forms of diseases affecting the heart. Despite the myriad treatment options, this condition is associated with high mortality (5 years, 50%), repeated hospitalizations and poor quality of life.

Atherosclerosis
Atherosclerosis is a complex and progressive disease characterized by the accumulation of lipids and fibrous elements in the large arteries. It is the number one cause of morbidity and mortality in Western societies. The current standard of care for atherosclerosis is statins. Despite significant improvement in the prognosis of atherosclerosis patients treated with statins, the disease process continuous to progress in a significant proportion of patients. Thus, alternative (or adjunctive) novel therapies that inhibit other triggers for this pathological state are needed to effectively manage or reverse this disease condition.

Treatment of CVD
It has become clear that CVD is an inflammatory disease, although what triggers the inflammation is still unknown. Consequently, diagnosis of CVD through inflammatory markers is an active area of research. Although several classes of anti-hypertensive drugs exist, the Board believe that there are still several treatment goals that remain to be achieved, such as better blood pressure control, greater protection against organ damage, and better tolerability. Several angiogenic and myogenic stem cell therapies are under investigation and promise in the long run to advance cardiac rehabilitation and even prevent heart failure. Despite the development of improved therapies, millions of people continue to live with life-threatening cardiovascular diseases. Recent breakthroughs, such as cell transplantation, suggest exciting directions that are likely to produce more effective therapies for the treatment of cardiovascular disease.

Market Opportunities
Here are just some of the considerable market opportunities which the Board believe have been identified within the CVD Market:

    * Increased use of cholesterol-controlling statins will cause prices to fall and generic brands to appear as knowledge of their benefits spread among general practitioners.
    * Development of anti-glycosylation therapies to prevent the cross-linking that weakens aging heart muscle, and to reduce the diabetic risk factor.
    * Create new vaccines to raise high density lipoprotein (HDL) levels, which help stave off heart disease.
    * Develop new angiotensin receptor blockers to offer greater competition against ACE inhibitors
    * Develop angiogenesis drugs such as VEGF (vascular endothelial growth factor) that will obviate the need for much bypass surgery by growing new arteries on damaged hearts.

Auto-immune Disorders

Background
Auto-immune disease refers to a group of disorders which arise from unwanted immune responses leading to chronic inflammations. Unwanted immune responses may affect joints (arthritis), skin (psoriasis, eczema), the nervous system (multiple sclerosis), the kidneys (glomerulonephritis), the thyroid (Hashimoto's disease), and the pancreas (type I diabetes). In fact, auto-immune diseases encompass more than eighty disorders. Perhaps the most well known of these is arthritis. Many auto-immune diseases are debilitating, often progressive with time and eventually fatal.

Market Opportunities
Due to the high failure rate amongst traditional drug treatments, the market has evolved into one incorporating multidisciplinary methods and treatments. The global autoimmune market generated $31.9bn in revenue in 2007, and it is expected increase at a growth rate of CAGR 8.1% to reach a total value of $51.0bn in 2013 according to 'The Autoimmune Market Outlook to 2013', a report published by Business Insights.

The fastest growing disease category for anti-inflammatory treatment is psoriasis, which saw the first introductions of expensive monoclonal antibody products in the last two years.

Rheumatoid arthritis is a chronic, debilitating disease, affecting 1-2% of the global population, and is the most common autoimmune disease. Cccording to the report, "Rheumatoid Arthritis Therapeutics: A Global Strategic Business Report”, the global market for rheumatoid arthritis biologic therapeutics is projected to exceed $23.12 billion by 2015. The market comprises a sizeable growth due to the increase of world life-expectancy.

The complexity of the immune system provides both opportunity and challenge for those in the pharmaceutical industry trying to manipulate it. The anti-inflammatory products market was dramatically shaken in September 2004 with the withdrawal from the marketplace of Merck's multibillion-dollar anti-inflammatory drug Vioxx. This was followed by the withdrawal of another cyclooxygenase-2 (COX-2) inhibiting anti-inflammatory product, Pfizer's Bextra, from the American, Canadian and European markets in April 2005. This left only one COX-2 inhibitor, Pfizer's Celebrex, on the U.S. market. Following the removal of Vioxx, the U.S. Food and Drug Administration (FDA) enhanced its scrutiny of this class of drugs and required black-box warnings to be placed on all similar prescription and nonprescription nonsteroidal anti-inflammatory drugs (NSAIDs). (Business comms company, March 2006)

There is a seemingly endless list of cytokines, receptors, and enzymes that can be disrupted in patients with autoimmune and inflammatory diseases, and the sheer number of options leaves plenty of chances for large established players and specialized newcomers alike to carve out niches for themselves. However, the transition from brainstorm to marketed drug is fraught with pitfalls. Targeting a single receptor or protein often means being foiled by the immune systems redundancy, while cutting too wide a swath through the system can result in unexpected side effects. Despite Herculean efforts to develop newer and better agents for treating these conditions, frustratingly few novel drugs have passed muster in clinical trials and reached the market in the last decade. The market continues to eagerly await safe and effective alternatives to existing therapies.

Value Creation

   1. Identify, evaluate and in-license/acquire product candidates cost-efficiently.
   2. Manage and maintain the IP effectively in a manner which maximizes opportunity
   3. Meet the set targets for development.
   4. Recruit and retain key management individuals as well as scientific staff.
   5. Manage progress consistently quarter by quarter in order to secure continuous    funding.
   6. Commercialize the portfolio through out-licensing strategies.

Nano-Technological Focus

The recruitment of Dr Andrew Miller as chairman of the Scientific Advisory Board will give the Company access to opportunities to novel pharmaceutical compounds and research.

The Directors believe that novel medicines from stress are certain to open up new paradigms in drug therapies. Emotional and psychological stresses are a constant to all individuals. Such stresses are also supplemented by routine physical stresses such as heat, light, alcohol and so on. Unfortunately, all of these external stresses enhance the possibilities for disease and lead to processes of degeneration in physical infrastructure that are akin to accelerated ageing. The Board are seeking opportunities within the batteries of stress proteins discovered over the past two decades of research. Stress proteins exist in abundance in all cells of all organisms under stress and act to protect cells from the ravages of stress. But responses to stresses can themselves be fatal should they persist without modulation. In other words, mechanisms must exist not only to defend against stresses but recovery from stresses must be managed too. Importantly data from Professor Miller’s team in the Imperial College Genetic Therapies Centre over the last few years has now demonstrated the existence of small molecules that do indeed modulate responses to stresses. Powerful new neuroprotective, analgesic (against peripheral neuropathic pain), and anti-epilepsy compounds have already been identified from this screen process. Compounds with cardiovascular effects have also been discovered.

The Company will seek to support the development of these compounds as pharmaceutical agents. It will also support research to extend the modulator concept for the discovery of actives against hyperlipidaemia, obesity and diabetes type II, including the development of appetite modulators (satiety-inducing compounds).

The Directors believe that nanomaterials and nanotechnology are certain to play important roles in the future, perhaps most significantly in improving healthcare opportunities. A key vision is that nanomaterials harnessed into key nanotechnologies could generate vast numbers of new drugs for novel targets thereby multiplying our opportunities for safe and effective medicines. This is particularly true where biopharmaceuticals are concerned.