Key Takeaways
- Everest has signed a global licensing deal for an anti-viral Covid treatment being developed by Singapore’s Experimental Drug Development Centre
- Similar oral anti-viral treatments have been developed by Pfizer and Merck, and are growing in popularity due to their ease of use
By Richard Barbarossa
Why settle for a single drug to treat Covid-19 when you can hedge your bets with two?
That appears to be the strategy at cancer and autoimmune disorder drug startup Everest Medicines Ltd.(1952.HK), which is doubling down on its bid to develop Covid drugs by signing a global licensing deal for a new way to treat the virus behind the global pandemic.
The new agreement with Singapore’s Experimental Drug Development Centre (EDDC) grants Everest worldwide rights to develop, manufacture and commercialize EDDC’s protease inhibitors, an oral viral treatment for Covid-19. Operated by the Agency for Science, Technology and Research, EDDC is Singapore’s leading state-supported drug research platform.
Under the deal, Everest would pay a license fee of $2.5 million, potential development milestone payments of up to $107 million, and sales milestone payments up to US$105 million.
The agreement, which was announced last week, comes just months after Everest signed another distribution deal in September for a Covid-19 vaccine based on messenger RNA (mRNA) technology being developed by Canada’s Providence Therapeutics Holdings Inc.
Clinical trials for the latest protease inhibitor treatment, which is designed to stop the virus from replicating, are expected to start sometime later this year, meaning any product launch is still some time away.
The latest treatment candidate looks like a solid wager from a business standpoint, as countries around the world continue to be swamped by the highly contagious omicron variant. Adding to the notion that new treatments are desperately needed, even if they are still far from commercialization, the World Health Organization warned global leaders that the pandemic “is nowhere near over.” The health body said more new variants are certain to arise and continue putting even greater pressure on already stressed healthcare systems.
Investors initially applauded Everest’s new deal, sending the stock up by almost 30% to a two-month high of HK$46.80 the day after the announcement. But the initial euphoria quickly wore off, perhaps as investors sensed their enthusiasm might be premature, with most of those gains gone by Thursday.
The reality is that Everest is doubling down in a very crowded field that includes other similar drugs developed by pharmaceutical giants such as Gilead (NASDAQ:GILD), Merck (NYSE:MRK), Pfizer (NYSE:PFE) and Eli Lilly (NYSE:LLY), as well as local peer Shanghai Junshi Biosciences (1877.HK), just to name a few.
The type of anti-viral drugs represented by the new agreement are one of five major ways companies are hoping to treat Covid-19. Some 59 anti-viral treatments are listed by the Biotechnology Innovation Organization’s treatment tracker as currently in development. Other treatment types include traditional and mRNA vaccines, and two types of anti-inflammatory medicines.
Reflecting the uphill battle Everest’s latest treatment could face, a flurry of regulatory approvals for other oral anti-viral treatments has made headlines in recent weeks. That includes two in the space of two days at the end of last month, when the U.S. Food and Drug Administration signed off on pills from Merck and Pfizer.
Pfizer, whose Paxlovid treatment was found to cut combined hospitalizations and deaths by about 89% among high-risk adults when taken soon after symptoms appeared, earlier this month announced it would double the number of courses supplied to the U.S. in 2022 to 20 million. That treatment received another boost this week when it was approved for use in Canada.
Varying Effectiveness
Merck has entered the field with its oral treatment, Molnupiravir. But that drug was found to only cut hospitalizations and deaths by 30%, showing there’s still room for other new candidates that might prove more effective.
Still, Everest will need to show the Singaporean-developed protease inhibitors can compete with the growing number of offerings entering the market, and then secure regulatory approval in countries around the world that are already stocking up on other drugs like Paxlovid.
Easy-to-use oral treatments like the one in the latest Everest deal are attractive because they allow patients to treat themselves from home. Gilead’s Remdesivir is the first approved anti-viral treatment, and is now being used in around 50 countries. The drug is only being used intravenously so far, though the company is currently exploring an inhaled treatment, according to a Forbes report this week.
Another leading contender to provide China’s first domestically developed non-vaccine Covid treatment is Brii Biosciences Ltd. (2137.HK), which is backed by Alibaba Group founder Jack Ma’s Yunfeng Investment and Sequoia Capital. The company received approval from the National Medical Products Administration in December for its monoclonal antibody therapy, which was shown to reduce hospitalization and death by almost 80%.
Monoclonal antibodies bind to the virus to prevent it from entering host cells and are administered intravenously.
That brings us to the question of if and when Everest might also be able to bring its Covid-19 vaccine or oral anti-viral to the market. The wait for China to approve mRNA vaccines for domestic use continues to drag on, even for treatments that have been approved in other markets.
Germany’s BioNTech (NASDAQ:BNTX), which is working with Shanghai Fosun Pharmaceutical (2196.HK; 600196.SH) to get its Comirnaty mRNA vaccine to the China market, told Reuters earlier this month it is “very difficult to predict” when that would be, after saying last year it could be last July.
Even if mRNA vaccines are eventually approved in China and Everest successfully develops its own, it could also face competition from Sinopharm (1099.HK), which is developing its own mRNA candidate. The pair of Suzhou Abogen Biosciences and Walvax Biotechnology (300142.SZ) are also working with the PLA Academy of Military Science on another mRNA candidate.
The latest update on Everest’s own mRNA Covid-19 vaccine candidate came late last month. At that time it said the treatment had been recommended by an independent advisory group to be part of the Solidarity Trial Vaccines clinical trials, sponsored and paid for by the World Health Organization.
Those trials are aimed at rapidly evaluating the efficacy and safety of promising new vaccine candidates. “We hope this can help accelerate approval with regulatory bodies around the world,” Everest CEO Kerry Blanchard said at the time.
