Thursday, January 10, 2013

Ohr Pharmaceutical (OHRP) Developing Squalamine

Ohr Pharmaceutical (OHRP) might be on to something.  Their main project right now is a squalamine eye drop solution to treat age-related macular degeneration (wet AMD).  The topical application of this solution is a different modality from the injection treatment that presently dominates the market.  The mere thought of injecting something into a patient's eyeball probably gives sufferers the creeps, so an eye drop solution is an easier bridge for a patient to cross.  About 200,000 new wet AMD cases are diagnosed each year but I can't find a comparable price for the competing injection, so it's hard to estimate the value of this part of the market.

The eye drop drug is in Phase 2 trials and its intravenous application with ovarian cancer patients has received orphan drug status, a key regulatory advantage.  The incidence of occurrence of both wet-AMD and ovarian cancer will determine the total size of the market for this drug.  About 20,000 new cases of ovarian cancer occur each year but Ohr's squalamine drug was applied in conjunction with carboplatin in its Phase 2 study, so if they have a combined effect then patients will need insurance coverage for both drugs.  Generic versions of carboplatin are available and the price per dose was over $9000 in 2006.  Using that as a comparable price, I can estimate first-year sales for the ovarian cancer market of $180M.  That is generous and comes with caveats.  My estimate works if Ohr's squalamine drug makes it to FDA approval, and if every new ovarian cancer patient gets a dual dose regimen (which in turn depends on doctors' inclination to prescribe it and insurance companies' coverage).

Let's not ignore the other drugs in their pipeline.  Their AVR-118 drug aims to treat cancer cachexia, for which most treatments have been ineffective.  That seems to be a potentially larger market than the market for ovarian cancer drugs and the competitive field is devoid of approved drugs.  If AVR-118 is a winner, Ohr will dominate the cachexia treatment field.

I like Ohr's strong management team.  The CEO and chief scientist have been through multiple rounds of drug development.  I don't know whether Ohr's drugs will ultimately win FDA approval but I am impressed with the positioning and progress of the two drugs mentioned above.  I'll check back on this one in about a year.

Full disclosure:  No position in OHRP at this time.