Alliance Pharma says unlikely to regain full market share for ImmuCyst
Britain's Alliance Pharma does not expect bladder cancer drug ImmuCyst to regain the 90 percent market share it held in the UK as the company gets ready to restart supplies that were halted last year due to problems at a plant.
Alliance Pharma holds the rights to sell ImmuCyst ��� made by the vaccines unit of Sanofi SA ��� in the UK and Ireland and expects to start selling the drug in the first half of 2014.
"We'll have to start from zero in the first half of next year and build up again," founder and Chief Executive John Dawson told Reuters.
"It's going to be a more gradual build to a market share level. I mean, we don't realistically see that we will get back to 90 percent."
Production of ImmuCyst was suspended in mid-2012 after mould was found in Sanofi Pasteur's 100-year-old manufacturing plant in Toronto, Canada. Sanofi Pasteur said it expects production to start later this year and distribution to begin in early 2014.
Rival drug OncoTICE, manufactured by Merck Sharp and Dohme and marketed by Organon Laboratories Ltd, has captured most of ImmuCyst's market share over the past year.
Alliance Pharma, which markets more than 60 products, said it is currently renegotiating terms of the ImmuCyst agreement with Sanofi Pasteur.
"There's got to be enough economic incentive for us to do that starting off from zero," CEO Dawson said.
The company acquired the drug along with 17 other products from Cambridge Laboratories in 2010.
Alliance said in March that ImmuCyst sales were growing at 18 percent before production was halted, with moving annual sales reaching 4.4 million pounds ($6.68 million). ImmuCyst accounted for about 9 percent of the company's revenue in 2011.
FinnCap analyst Keith Redpath said that once supplies begin, Alliance Pharma could look at bundling and selling ImmuCyst with other oncology products they distribute. The company could also consider cutting the price of the drug, he added.
REGULATORY PRICING PRESSURE
Alliance Pharma focuses on two therapeutic areas - dermatology and oncology, and generates about 75 percent of its revenue from the UK. It acquires the rights to drugs with a relatively predictable cash flow and low risk of generic competition.
The latest in its bag is Syntometrine - a drug used in the late stage of labor - which it acquired from Novartis AG for $11.5 million earlier this month.
Britain's Department of Health has signaled a 10 percent to 20 percent cut in prices of prescription drugs even as the industry negotiates a deal for the majority of products sold through the Pharmaceutical Price Regulation Scheme (PPRS).
Alliance said that about a third of its products could come under the ambit of the price cuts.
"Prescription prices are now relatively low in Europe and from an industry point of view we do not believe that there is a case at all that prices should be changed or come down in the UK," Dawson added.
Shares in the company were down 0.35 percent at 35.76 pence at 9.21 a.m. ET on Wednesday on the London Stock Exchange. The stock, which fell about 22 percent to a near three-year low when Sanofi Pasteur suspended production of ImmuCyst, has gained about 50 percent since then on the back of three acquisitions.
($1 = 0.6592 British pounds)
(Reporting by Abhirup Roy in Bangalore; Editing by Supriya Kurane and Saumyadeb Chakrabarty)