Bending the Curve

Clearly, HIV/AIDS is a major public health problem in sub-Saharan Africa where, according to the WHO, about 1 in 20 is infected, 60% of all of the people living with AIDS reside, and 1.2 million died of the disease in 2011.  Fortunately, with two decades’ input of money, technology, and organization from local and donor country governments, NGOs, and companies, 10 million of the estimated 35 million infected are receiving anti-viral therapy with a better chance of living a relatively long and productive life.  The ideal and long-term goal for the public health system is to bend the incidence and mortality curves downward via prevention, early detection, treatment, and monitoring during treatment.  Of course, turning back the epidemic also requires treatment for co-infections like tuberculosis and hepatitis C and improved living conditions and nutrition- a tall order.  Progress is being made in turning diagnostic technology into products, and I have noted four advances made over the past year that are worth mentioning.

Last August, a product was released that provides earlier and better detection of infection.  Alere, a three billion-plus dollar revenue diagnostics company based in nearby Waltham, MA, received FDA approval for its point-of-care (POC) Determine HIV-1/2 Ag/Ab Combo test, which detects an HIV-1 antigen and antibodies to HIV-1 and HIV-2.  As noted in the company press release, it is the first test of its kind, and its ease of use makes it ideal for public health settings where lab-based diagnostics are not practical.  While the release also indicates that the test is aimed at the US, the product may deployed to developing world markets in the near future.  As I noted in my post last March (“DX Rock Stars”), Alere received a $42 million grant from the Gates Foundation for the development of a tuberculosis POC test (mostly) and for the manufacture of a lab-based HIV viral load test (partly).  In that post, I posited that Alere was building a developing world/global health diagnostic business, so this new assay may be part of that business.

More recently, Sedia Biosciences, a Oregon-based early-stage company, was awarded a $1 million NIH Phase II SBIR grant to develop an FDA-approved version of its HIV test that is currently used in public health to assess HIV prevalence (FierceDiagnostics article and Venture Beat article).  The assay measures HIV-1 antibody binding ability that is a measure of antibody maturation and therefore an indirect indicator of disease progression.  Some research has indicated that, in the US anyway, 40 to 50% of new HIV infections come from infected persons who were recently infected and therefore have high viral loads so finding these recently infected persons may help reduce the overall rate of infection.  Since the assay is POC and more informative, it may replace the current widely available, rapid HIV tests in Africa if priced right.

There are two companies that are making progress in the development of products for the monitoring of the response of the disease to treatment.  The first is Zyomyx of Fremont, CA, which last June signed a financing and distribution agreement with Mylan Laboratories, Inc. (Mylan), a major generic pharma company based in Pennsylvania, for its CD4-positive T-cell count test, a primary measurement of disease progression (FierceMedicalDevices article).  Zyomyx’s test is disposable and low-cost ($10 each), works without electronics or instrumentation, and is therefore ideal for developing-world use.  The assay is the result of a novel product development effort by the CD4 Initiative, a program based at Imperial College in the UK and funded by the Gates Foundation that started in 2006 with a call for proposals and the awarding of support to six academic and industrial groups including Zyomyx.  In my opinion, this model is worthy of study and imitation for any group, foundation, or company serious about global health product development.  As for the next steps, Zyomyx will use the new financing, that totals $12 million of which $6 million is from Mylan and the rest from existing investors including the Gates Foundation, to secure US and other regulatory approvals and to scale up manufacturing.  The diagnostic deal is a first for Mylan, and it intends worldwide distribution in conjunction with sales of its antiretroviral drugs that are currently used in more than 120 countries and by nearly 40% of HIV/AIDS patients receiving treatment in the developing world (Zyomyx-Mylan press release).  Mylan also has agreed to the “global access” terms accepted by Zyomyx as part of its Gates funding (a total of $16 million it received over five years) that essentially require Mylan to distribute the test at a reasonable price.  It will be interesting to see how well the Mylan sales team has done its pre-deal work and what price its customers, probably public health agencies subsidized by donor governments or foundations, will find reasonable (no sales have been announced to date).  With a patient base of 10 million growing to millions more in Africa alone and testing done on each about twice a year, even an affordable price should generate tens of millions in annual revenue.

The second company is Daktari Diagnostics that is developing a competing technology for CD4 counts (a portable reader and cassette system requiring no sample preparation) and that I have mentioned in previous posts (e.g., “B2B2B2” ).  Daktari is a local firm and one of the few global health companies started with venture capital, about $3 million in 2009 followed by another $6.25 million in 2011.  Last May the company raised an additional $7 million with the proceeds to be applied to hiring 126 more employees and building operations in Scotland (Boston Business Journal blog).  Last month, the company announced receipt of ISO certification of its device and manufacturing process, an important commercial milestone (Daktari press release).  And this week, Bill Rodriguez, Daktari’s CEO, said in an interview that the company is in the process of completing a $25 million Series D round to be used to expand its sales and support staff to service eleven African countries and to support development of additional products (FierceDiagnostics article).  Next step should be a sales deal.  According to Bill:  “We’re looking at initial product orders in the hundreds of thousands of tests.”

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