Prof. Arie Belldegrun sees $1b market for UroGen drugs

Arie Belldegrun Photo: PR

The UroGen chairman is sanguine about the prospects for the Israeli drug developer's bladder and urinary tract cancer treatments.

Israeli company UroGen Pharma Ltd. (Nasdaq: URGN), which develops drugs for treatment of cancer in the urinary tract, announced on Tuesday the results of a trial of the second product in its pipeline for treatment of bladder cancer. The company's leading product, designed for treatment of cancer in the upper urinary tract, is scheduled to reach the market next year. UroGen's market cap is $682 million.

UroGen's share price plunged 16% yesterday in response to the publication of the trial results, and has shed 36% of its value in 2019.

UroGen chairman Prof. Arie Belldegrun, a serial medical entrepreneur, sold Kite Pharma to Sciences in 2017 at a company valuation of over $11 billion. Belldegrun, originally a urologist, is still carrying out the surgery that the company wants to replace. Commenting on UroGen's newly announced results, Belldegrun told "Globes," The market that we are aiming at with our lead product is in the hundreds of millions of dollars, and could grow to $1 billion, when we launch our second product." Before the second product can be launched, however, another major trial will be needed, the character of which is not known, and will be determined in a meeting with the US Food and Drug Administration (FDA).

According to the results published by UroGen, treatment using its second product caused the malignant tumor to vanish in 63% of bladder cancer patients. The product is designed to replace surgery, which also gets rid of the tumor, but the tumor usually recurs, requiring additional surgery within about a year. UroGen will continue monitoring patients in order to see whether it succeeds in both replacing the surgical procedure and lengthening the time between procedures.

The most important standard for judging the results

The analysts who participated in the day for investors held by UroGen yesterday explained that the length of time before the tumor recurs is the most important yardstick for evaluating the results - more than the number of patients who responded.

UroGen also announced this week the full results of a trial of its leading product. In this trial, cancer disappeared completely from 59% of patients, a result that persisted for six months among 89% of patients and for 12 months among 84% of patients. The average time before cancer began to recur was 13 months.

The alternative treatment is removal of the kidney, so these results are considered positive. The company's share price, however lost 1.45% on Tuesday and 16% on Wednesday, perhaps in response to the safety results for the product, which included urinary tract inflammation, pain, and a need for implanting a urological stent among one third of patients.

UroGen's loss in the second quarter of 2019 was $22.5 million. The company had no substantial revenue.

Next stage: Head to head comparison with surgery

UroGen CEO Liz Barrett, former CEO of Novartis Oncology, said, "The product for treatment of upper urinary tract cancer is replacing kidney removal surgery, and since this need was clear and urgent, the route for development of the product was fairly short, allowing us to reach the market quickly.

"There is a solution for bladder cancer: to anesthetize the patient and operate on him again and again. Doctors have become accustomed to this solution, and there is no alternative to carrying it out. The option of treating the problem with an injectable drug without surgery is exciting the doctors, although it obviously requires education of the market."

"Globes": In a market in which the economic incentive is so significant in the health system, is it worthwhile for a doctor to abandon operations for drug treatment?

Barrett: "The next stage of trials will probably be a head-to-head comparison with surgery. This will make it easy for us to show both the FDA and the doctors that the results can be equal or better, with less suffering for the patient. We're building the value chain for the product, so that the doctors will not lose from the switch from surgery to a medicinal product."

How are you preparing for launching the leading product, and what is the timetable?

"The request will be submitted by the end of the year, and we expect to get the answer within six months. We have already assembled the sales team, and we're working on the matter of insurance reimbursement. It's still impossible to get an independent reimbursement code when the product isn't in the market, but we're talking with insurance concerns in the US to prepare the spadework, and with doctors to teach them how to bill for the procedure with the existing codes. We estimate that within 3-4 months of the launch, we will have our own reimbursement code. Such a development helps with sales of the product to doctors, because then they are more confident that they will get the reimbursement, and the money gets to them more quickly."

A review published by the Jefferies investment bank expressed concern that the launch of the leading product for the upper urinary track was liable to be somewhat slow if urologists must first buy the product and only bill for it later. It is therefore particularly important for the company to obtain its own reimbursement code.

What is next for you?

Belldegrun: "There were once companies specializing in urology in the market, but they were acquired by general medical devices companies, and this expertise to a great extent no longer exists. We want to create a urology company, so in the future, we'll obviously also try to acquire rights to additional products, not necessarily for other types of cancer, but probably also in urology and gynecology.

"When the company had fewer resources, it had to be focused, so we sold the rights to develop our product for treatment of overactive bladder syndrome to Allergan. This is a much bigger indication than those we are now dealing with, but we had to be focused. We needed the money at the time, which was before our Nasdaq IPO. Even so, it's rare for an Israeli company to bring a drug to market by itself. The deal with Allergan, however, demonstrates the fact that our technology can be used for a wide range of drugs for the urinary tract, not just oncology drugs."

Published by Globes, Israel business news - en.globes.co.il - on September 26, 2019

© Copyright of Globes Publisher Itonut (1983) Ltd. 2019

Arie Belldegrun Photo: PR
Arie Belldegrun Photo: PR
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