Posted on: Monday, February 25, 2002
Firm puts trust in cold-fighting drug
By Joann Loviglio
Associated Press
PHILADELPHIA — Like the people it says it hopes to treat one day, ViroPharma Inc. has seen its share of aches and pains. But officials at the pharmaceutical firm say they're optimistic their groundbreaking common cold drug will reach the market.
The search for a medicine to treat the common cold has been a 20-year quest for the 10 scientists who founded ViroPharma in 1994. Researchers experimented with 1,500 versions before starting human testing on the drug, called pleconaril.
Unlike store-bought cough suppressants and decongestants, which ease cold symptoms by soothing aches and drying sniffles, pleconaril attacks a large group of bugs — 169 strains in all — that includes the rhinovirus, the virus that causes about half of all colds.
The medicine, taken three times a day for five days, stops the virus by fitting into a groove on its surface, locking up the machinery the virus needs to enter the body's cells. According to research, the drug eases cold symptoms within a day and makes a runny nose completely clear up a day sooner than usual.
"We believe this is going to be successful, and we're very passionate about making it happen," said chief financial officer Vincent J. Milano.
ViroPharma, based in the Philadelphia suburb of Exton, is hoping for approval of pleconaril later this year from the Food and Drug Administration. The company has not said how much it would charge for the drug, which would be sold by prescription under the brand name Picovir.
An FDA advisory panel has scheduled a hearing for March 19, and analysts expect the panel to take action sometime over the summer. Milano said that with FDA approval, ViroPharma could start marketing the drug in the second half of this year.
The company's research indicates the drug is the first to help people with colds feel better faster, but investors seem to have become skeptical. After hitting a high of $111.63 in March 2000, ViroPharma's shares are trading at about $18.
"Investors are waiting to see what happens with the FDA, and that's reflected in the share price. It has been weak," said Sushant Kumar, senior analyst for Mehta Partners. "If it passes with flying colors, surely investor confidence will increase at that point."
Timothy D. Coan, an analyst with ABN Amro, said getting FDA approval is important, but really big gains for the company could come with new uses for the drug, such as a treatment for asthma.
"Those would really drive long-term sales," Coan said.
FDA approval could be difficult. Experts say they expect the agency to be cautious because any drug used to treat a non-lethal infection in healthy people must be extremely safe.
ViroPharma said it's too soon to say how much the drug will cost — an uncertainty that probably has contributed to the drop in ViroPharma's stock. Analysts say price is a major issue, because a medication that brings relief only one day faster might not be reimbursed by health maintenance organizations if it's too costly — and that means doctors won't prescribe it.
The company "is probably feeling out the HMOs right now" regarding price issues and would likely not put the cost for the drug at a figure higher than what HMOs would reimburse, Coan said.
ViroPharma was founded by scientists who formerly worked for Sterling Drug Inc. and who took the company public in 1996. The firm hasn't reported a profit since it has been publicly traded, but that's not unusual for a startup in the pharmaceutical or biotech industries.
