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New HCV & HBV Drugs: toll-like receptors
  The company distributed this press release.
"Anadys Pharmaceuticals Announces Exclusive Collaboration With Novartis to Develop and Commercialize ANA975 and Additional TLR7-Based Therapeutics for Hepatitis C and Hepatitis B"
Thursday June 2, 1:32 am ET
--Total Partnership Valued at Up to $570 Million in Upfront and Potential Milestone Payments
SAN DIEGO, June 2 /PRNewswire-FirstCall/ -- Anadys Pharmaceuticals, Inc. (Nasdaq: ANDS - News) announced today that it has entered into an exclusive global license and co-development agreement with Novartis to develop, manufacture and commercialize ANA975 and additional Toll-Like Receptor 7 (TLR7) oral prodrugs for chronic hepatitis C virus (HCV) and hepatitis B virus (HBV) infections, as well as other potential infectious disease indications. In addition to upfront and milestone payments, the agreement includes potential royalty payments and a U.S. co-promotion option for Anadys.
Hepatitis B Programs
We have an exclusive license from LGLS and are conducting a joint development program with LGLS for the clinical development and potential commercialization of ANA380, a compound currently in Phase II clinical trials for the treatment of chronic HBV infection. Our license covers the development and commercialization of ANA380 for the treatment of chronic HBV infection in North America, Europe, Japan and most other countries in the world other than China, Korea, India and countries in Southeast Asia. We are jointly developing ANA380 with LGLS on a global basis.
Hepatitis B Background
Hepatitis B is a growing global health problem that can cause both acute and chronic viral infections. According to the World Health Organization, more than 2 billion people alive today have been infected with HBV at some time in their lives. Of these, about 350 million people remain chronically infected and become carriers of HBV. Over 4 million acute cases of HBV develop each year and about 25% of these cases result in death each year due to chronic HBV or related conditions, including cirrhosis and liver cancer.
Current Treatment
Current treatments for HBV include interferon-alpha therapy, lamivudine and adefovir, but suffer from significant limitations as long-term therapies, including the many side effects associated with interferon treatment, the potential for renal toxicity associated with adefovir, and the emergence of HBV varients resistant to lamivudine treatment. Significant unmet needs remain for improved HBV therapies for the more than 350 million people chronically infected with HBV.
ANA380 is currently in Phase II development.

ANA380 is a nucleotide analog that has exhibited activity in vitro activity against both HBV typically found in untreated patients and also HBV variants that are resistant to lamivudine. Phase I studies in healthy volunteers showed that ANA380 (LB80380) was safe and well tolerated with pharmacokinetics that predict once daily dosing. These favorable results enabled a recent, double-blinded, randomized, placebo controlled, rising dose study in 28 patients chronically infected with HBV.
We expect that the mechanism of action of isatoribine may provide utility in HBV infected patients in a similar manner as in HCV infected patients. As a result, we are exploring the use of isatoribine and isatoribine prodrugs, including ANA975, for the treatment of HBV. We have designed our clinical plan to give us the flexibility to conduct clinical trials in both HCV and HBV infected patients, we currently expect to commence clinical trials on ANA975 in the first half of 2005.
Hepatitis C Programs
We are developing compounds to treat HCV as both an alternate frontline therapy and for the prevention of relapse. We expect that our compounds could potentially be used as monotherapies or in combination with standard-of-care drugs. We have recently completed a multi-component Phase IB trial in recognized clinical centers in Western Europe and have completed Phase IA clinical trials for isatoribine. In addition, we have recently completed clinical trials on ANA971, an oral pro-drug of isatoribine. Based on the results of clinical trials, we plan to continue to advance either isatoribine or ANA971 as a monotherapy treatment to reduce the risk of HCV relapse. We are also advancing ANA975, another oral pro-drug of isatoribine, to be used as a frontline therapy for HCV.
HCV Discovery Programs
We have investigated additional mechanisms that may confer therapeutic potential for HCV. We have conducted preclinical studies of ANA246, a nucleoside analog that acts to enhance Type 1 cytokine synthesis by stimulating the production of cytokines that activate the cellular component of the immune system. ANA246 has been shown to have similar in vitro immunologic activity to ribavirin and levovirin. We are not currently actively developing ANA246 but may elect to continue its development in the future.
Hepatitis C Background
Hepatitis C virus causes inflammation of the liver and degradation of liver function. Approximately 70% of individuals infected with HCV progress to chronic hepatitis. The most common symptoms of chronic hepatitis, which may show no symptoms for many years, include an enlarged liver and spleen, jaundice, muscle wasting, excoriations (the result of scratching), ascites (swelling of the abdomen) and swelling of the ankles. Chronic infection may also progress to further, more serious complications such as cirrhosis of the liver, liver cancer and death. Of those patients who progress to chronic hepatitis, 10%-20% develop cirrhosis over a period of 20 years, with approximately 1-5% of these patients progressing to end-stage liver disease or liver cancer in their lifetime. In total, HCV causes 10,000 to 12,000 deaths a year in the U.S., and the Centers for Disease Control, or CDC, estimate the annual mortality rate could increase to 38,000 by the year 2010, surpassing the number of deaths attributed annually to HIV/AIDS.
The CDC reports that as of the end of 2002 approximately 2.7 million Americans were chronically infected with HCV and at risk of disease progression. There is no vaccine available to prevent the spread of HCV.
Under the terms of the agreement, Novartis will make an initial license payment of $20 million to Anadys. Anadys is also eligible to receive up to $550 million in regulatory and commercial milestone payments based on the successful development and commercialization of ANA975. A $10 million payment is due following a successful Investigational New Drug (IND) submission, which Anadys expects to file with the U.S. Food & Drug Administration (FDA) in the middle of 2005.
In addition, Anadys has a co-promotion option to retain 35 percent of profits in the U.S. by contributing 35 percent of the commercialization costs in the U.S. In the event Anadys declines to exercise its option, it will receive royalties on net sales of products in the U.S. Anadys will also receive royalties on net sales of products in the rest of the world. The agreement does not include an equity purchase. The collaboration announced today is subject to clearance under the Hart-Scott-Rodino Antitrust Improvements Act.
ANA975 is an oral prodrug of isatoribine, a small molecule TLR7 agonist that has been administered intravenously to 68 subjects in clinical trials. Results from multiple clinical trials in HCV patients receiving intravenous isatoribine for one week have demonstrated statistically significant viral load reductions. Interim data from an ongoing Phase I clinical trial of ANA975 indicate that the bioavailability of ANA975 is virtually complete (approaching 100 percent) and conversion to isatoribine in plasma is rapid and effective, delivering levels of isatoribine that have been shown to be clinically relevant. Anadys and Novartis expect to initiate a 28-day study of ANA975 in HCV patients in the second half of 2005.
"Anadys is at the forefront of TLR-based small molecule therapeutics," said Thomas Ebeling, Chief Executive Officer of Novartis Pharma AG. "This agreement is a further step in our strategy to augment internal activities with externally sourced products in key therapeutic areas such as HCV and HBV, where Novartis is working to meet the needs of these patients."
"Results of our clinical studies suggest that TLR7 agonists may represent an important new advance in anti-infective therapies," said Kleanthis G. Xanthopoulos, Ph.D., Anadys' President and Chief Executive Officer. "We look forward to working with Novartis who shares our vision and commitment to combating infectious diseases. Together we hope to realize the potential of TLR-based therapies, including ANA975, as a creative and novel treatment for HCV, HBV and other infectious diseases."
The license to Novartis by Anadys includes rights to additional oral prodrugs of TLR7 agonists for potential use in infectious disease indications. The two companies will work closely to develop ANA975 and may collaborate to develop next-generation TLR-based compounds for HCV and HBV and other infectious disease indications. Novartis has also obtained an exclusive option to potentially license Anadys' rights to ANA380, a compound currently in Phase II clinical trials. ANA380 is currently being co-developed by Anadys and LG Life Sciences for the treatment of chronic HBV infection.
Conference Call and Webcast
Anadys will host a conference call on Thursday, June 2, 2005 at 9:00 a.m. Eastern Time to discuss the contents of this press release. A live webcast of the call is available online at www.anadyspharma.com. A telephone replay will also be available approximately one hour after completion of the call. To access the telephone replay, dial (888) 286-8010 or (617) 801-6888, passcode 64943988. The webcast and telephone replay will be available through June 16, 2005.
Reuters article:
Anadys in deal with Novartis on hepatitis drugs

Thu Jun 2, 2005 05:48 AM ET
NEW YORK, June 2 (Reuters) - Anadys Pharmaceuticals Inc.(ANDS.O: Quote, Profile, Research) said on Thursday it has entered into a licensing and marketing agreement with Swiss drugmaker Novartis AG (NOVN.VX: Quote, Profile, Research) for the development and eventual sale of Anadys's experimental drugs to treat the liver disease hepatitis.
The San Diego-based biotechnology company said under terms of the deal it will receive an initial license payment of $20 million and is eligible to receive up to $550 million from Novartis in regulatory and commercial milestone payments based on the successful development and sale of ANA975 for chronic hepatitis C and hepatitis B infections.
A $10 million payment is due Anadys after it successfully files an investigational new drug (IND) submission with U.S. regulators, which it expects to do in the middle of this year, Anadys said.
Anadys also has a co-promotion option to retain 35 percent of profits in the United States by contributing 35 percent of the commercialization costs. Should Anadys decline to exercise its option, it will receive royalties on net sales of products in the United States, the company said.
Anadys will also receive royalties on net sales of its products sold by Novartis in the rest of the world, the company said.
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