January 15, 2006 (Vol. 26, No. 2)

Developing Techniques for the Protection and Stimulation of Beta Cells

German biopharmaceutical company DeveloGen (www. develogen.com) initiated European Phase III trials with its lead diabetes immunotherapy product, DiaPep277.The company also recently presented positive results from two Phase II trials of DiaPep277 in type 1 diabetes patients.

The two trials, including a one-year extended safety and efficacy study, indicate that DiaPep277 preserves beta cell function as measured by stimulated C-peptide levels. It also seems to improve glycemic control with treated patients requiring less insulin. A second product, Somatoprim, is expected to start clinical development for the treatment of diabetic retinopathy in 2006.

Established in 1998, DeveloGen has evolved into an integrated drug discovery and development company, focused on treatments for types 1 and 2 diabetes and diabetic complications.

Estimates suggest about six percent of the worlds population suffers from diabetes, which can be subdivided into three classes. Type 1 diabetes and latent autoimmune diabetes in adults (LADA) are caused by the progressive destruction of the pancreatic insulin-producing beta cells. Type 2 diabetes is caused by a combination of insulin resistance and pancreatic beta cell dysfunction.

DeveloGen is actively developing innovative and potentially disease-modifying therapies for all of these indications.

Protecting Beta Cells

DiaPep277 is an immunomodulatory peptide derived from the heat shock protein 60, designed to protect insulin-producing beta cells from autoimmune destruction in both type 1 diabetes and LADA.

DiaPep277 has the potential to halt progression of the disease, improve metabolic control, and reduce the need for insulin administration. LADA is a less well-characterized disorder with a huge market potential and is often classified as type 2 diabetes because onset tends to follow patterns similar to type 2 disease, even though the etiology is driven by autoimmunity and thus type 1 diabetes-related. Our development of DiaPep277 for LADA will follow on from the type 1 diabetes indication, explains Guenther Karmann, Ph.D., CEO.

Our initial target population for DiaPep277 will be newly diagnosed type 1 diabetes patients and those with some remaining endogenous insulin production, explains Dr. Karmann.

Beta Cell Regeneration

DeveloGen acquired DiaPep277 as part of its 2004 merger with the Israeli immunotherapeutics company, Peptor, a move that resulted in a combined pipeline that includes candidates for the treatment of type 1 and 2 diabetes via both immunomodulatory and regenerative approaches, Dr. Karmann continues.

Prior to the Peptor deal, he says, one of our main in-house R&D programs was centered on stimulating pancreatic beta cell regeneration using growth factors and small molecule synthetic agonists of Pax4, a transcription factor that has been shown to play a crucial role in beta cell development.

These programs are ongoing, and a series of candidate drugs, currently in preclinical development, represent the foundation for a future treatment that will trigger patients own stem cells to develop into insulin-producing beta cells.

With DiaPep277 and the growth factor/Pax4 programs, we have the means to develop separate treatments that protect beta cells from autoimmune attack and stimulate beta cell regeneration. Our protein drug, or growth factor, development programs represent a particularly exciting opportunity for DeveloGen, both from an IP and time-to-market point of view.

DeveloGens beta cell regeneration program includes the recombinant protein, DG119, a novel, highly conserved secreted protein identified by DeveloGen through large-scale screens searching for secreted proteins involved in the early stages of pancreas development and insulin-secreting cell differentiation.

Early studies confirmed that the protein is expressed in the blood vessels of the embryonic pancreas, which are an important source for beta cell differentiation and survival signals. Additional in vivo studies demonstrated that transgenic mice, expressing DG119 under the control of a pancreas-specific promoter, develop increases in overall beta cell mass and islet size. DG119 transgenic mice also appear resistant to alloxan-induced beta cell damage.

Having developed a eukaryotic expression system for the production of recombinant DG119, DeveloGen says it plans to initiate in vivo pharmacological studies with the product during 2005.

Somatostatin Analogue

Following behind DiaPep277 as the companys second lead candidate is Somatoprim, a somatostatin analogue in development for the treatment of diabetic complications, primarily diabetic retinopathy and, potentially, diabetic nephropathy.

Developed completely in-house to date and expected to start in clinical trials during 2006, Somatoprim is a cyclic 8 amino acid peptide that, DeveloGen maintains, reduces elevated levels of growth factors, such as growth hormone (GH) and vascular endothelial growth factor, in the retina of diabetic animals. In vivo the drug also improves parameters related to kidney function, such as renal/glomerular hypertrophy, glomerular hyperfiltration, and urinary albumin excretion.

The company claims that Somatoprim is not only as effective at suppressing GH levels as currently marketed somatostatin analogues, but also, unlike the current drugs, Somatoprim does not suppress insulin secretion or gastrointestinal motility, so that it would have major benefits for diabetic patients.

In November 2004 the company was awarded E1.4 million in funding from Germanys Federal Ministry of Education and Research under its BioChancePLUS program, to continue development of Somatoprim as a treatment for diabetes-related complications.

Functional Genomics

DeveloGens target discovery capabilities in type 2 diabetes and obesity hinged on a proprietary, phenotype-first functional genomics platform, based on genome-wide screens of Drosophila melanogaster.

Model organisms with characterized metabolic phenotypes have been generated via large-scale genome-wide mutagenesis and screened to identify novel drug targets, which have then been validated in mouse models and human ex vivo tissue samples. Since 2003, this program has been focusing on four validated targets, two of which were originally discovered by DeveloGen scientists.

Partners Sought

Current projects aside, DeveloGen is looking to expand its product pipeline even further, both through the development of additional in-house products and through in-licensing, states Dr. Karmann. We are also actively seeking a partner for several of our programs, in particular DiaPep277 and the type 2 diabetes/obesity and Pax 4 programs, which all have a huge potential market and would benefit from the sales and marketing expertise of a major international pharmaceutical partner for continued development and commercialization.

The company recently signed a worldwide collaboration and licensing agreement with Debiopharm (www.debio pharm.com) for PTR-262, a synthetic peptide in development of the treatment of myasthenia gravis.

The peptide, derived from the myasthenogenic epitopes of the acetylecholine receptor alpha subunit, is designed to down-regulate immune responses associated with myasthenogenic peptides. Under the terms of the agreement, Debiopharm will develop PTR-262 before out-licensing to global partners for commercialization.

Maximizing Long-term Potential

Since 2002 DeveloGen has made significant strategic changes to its operation, moving away from target discovery to completely focusing on developing its current pipeline and adding new products for diabetes and metabolic diseases, Dr. Karmann points out.

We believe we have unparalleled expertise in the field of diabetes target and drug discovery, combined with in-depth biological insight into diabetes and other metabolic disorders. By focusing our efforts on progressing a promising, growing pipeline, we will accelerate time-to-market and maximize our long-term growth potential.

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