Oramed sees value creating events through 2016

josh hexter

josh hexter

Oramed Pharmaceuticals’ (NASDAQ:ORMP) oral insulin development program has multiple value-creating events in the works through 2016.

They include completion of an ongoing Phase 2b FDA multi-site study for oral insulin (ORMD-0801) in Type 2 diabetes, completion of a Phase 2a FDA study and initiation of a Phase 2b multi-site study in Type 1 diabetes, and initiation and completion of a Phase 1b study in Israel with its oral GLP-1 analog (ORMD-0901) to be followed by initiation of a Phase 2 multi-site study for the compound in the U.S. next year.

“Our ORMD-0801 drug candidate has the potential to create a new paradigm in the treatment of diabetes by oral delivery of insulin at an earlier stage of treatment, potentially slowing disease progression and delaying or even eliminating late-stage complications,” Josh Hexter, says in an interview with BioTuesdays.com.

Mr. Hexter, COO and VP of business development, explains that the unsolved challenge of delivering oral proteins and peptides is twofold: protein denigration and absorption.

The acidic pH in the stomach and protease enzymes in the digestive tract shred and breakdown proteins, eliminating their therapeutic capabilities, and even if the protein successfully survives the harsh environment of the digestive system, it is often too large to be absorbed through the intestinal wall.

“Our platform technology addresses these challenges by protecting drug integrity and increasing intestinal absorption,” he adds.

Oramed’s technology employs a pH sensitive enteric coating to protect the encapsulated insulin in the stomach so that the capsule dissolves only once in the small intestine. It also utilizes a special cocktail of protease inhibitors to stave off and protect the insulin from protease attack and includes an absorption enhancer allowing for increased absorption via the intestinal wall.

“As a result, insulin can cross the intestinal barrier, enter the portal vein en route to the liver and then be delivered systemically,” he contends.

While insulin injections move directly to the bloodstream with only a fraction reaching the liver, Oramed technology addresses this issue by protecting drug integrity and increasing intestinal absorption

While insulin injections move directly to the bloodstream with only a fraction reaching the liver, Oramed technology addresses this issue by protecting drug integrity and increasing intestinal absorption

Regular injections of insulin move directly to the bloodstream, with only a fraction of it reaching the liver. As a result, excess sugar is moved and stored in fat and muscle, which often results in weight gain. It may also cause hypoglycemia, or low blood sugar.

Mr. Hexter points out that because oral insulin is delivered first to the liver, there is the potential for better blood glucose control, reduced hyperglycemia, and a negative impact on weight gain.

Oramed’s flagship product for the oral treatment of Type 1 and Type 2 diabetes is ORMD-0801. More than 2,000 doses of ORMD-0801 have been administered to nearly 200 study subjects and the safety profile has been very clean, Mr. Hexter contends.

In an initiation report last month, Rodman & Renshaw analyst Raghuram Selvaraju said Oramed constitutes a differentiated take on diabetes therapy, focusing on oral delivery of existing therapeutic agents like insulin and exenatide.

Type 1 diabetes is an autoimmune disease where the body destroys its own insulin-producing beta cells in the pancreas, leaving patients completely dependent on injections of insulin. Up to 37 million people worldwide have the Type 1 condition, representing up to 10% of all diabetics. Estimates of the market opportunity for Type 1 diabetes are $13-billion by 2023.

Type 2 diabetes, is a metabolic disorder that is characterized by high blood sugar in the context of insulin resistance and relative lack of insulin production. Some 371 million people worldwide are believed to need treatment, with market forecasts reaching $39-billion by 2019.

The three stages of Type 2 diabetes include lifestyle modification, including diet and exercise; oral therapies to reduce insulin resistance and stimulate insulin secretion; and insulin replacement injections.

The American Diabetes Association has encouraged the earlier use of insulin therapy in the disease paradigm to improve patient outcomes and reduce side-effects of diabetes.

Mr. Hexter says Oramed’s lead indication for ORMD-0801 in Type 2 diabetes is designed to reduce excessive nighttime glucose production in the liver, by acting in the same way as natural insulin does. Treatment would involve taking one capsule at bedtime.

“Excessive production of glucose at night as measured by high fasting blood glucose in the morning represents a significant challenge in diabetes management,” he adds. “Treatment with oral therapies is generally suboptimal in achieving normal fasting blood glucose levels.”

Mr. Hexter says an oral insulin therapy could reduce fasting blood glucose levels, increase patient compliance and slow down progression of diabetes and later-stage side effects.

In an earlier Phase 2a study with 30 Type 2 patients, ORMD-0801 was observed to be safe and well tolerated, with no hypoglycemic events in any member of the treatment group, Mr. Hexter says. The study also observed a sustained glucose reduction after fasting, at nighttime and daytime.

Oramed’s ongoing Phase 2b trial in the U.S. has enrolled more than half of its 180 patients to evaluate the safety of ORMD-0801 and its effect on overnight glucose levels from one capsule taken at night.

Oramed’s Phase 2b trial in the U.S. has enrolled more than half of its 180 patients to evaluate the safety of ORMD-0801 and its impact on overnight glucose levels

Oramed’s Phase 2b trial in the U.S. has enrolled more than half of its 180 patients to evaluate the safety of ORMD-0801 and its impact on overnight glucose levels

“In our view, the positive pharmacokinetic data and favorable safety profile of ORMD-0801 leads us to believe that the currently-ongoing Phase 2b trial of this agent should yield positive data in the first half of next year,” Rodman’s Mr. Selvaraju said.

He initiated coverage of Oramed with a “buy” rating and a 12-month price target of $24. Shares of Oramed closed at $7.75 on Friday.

In its program for Type 1 diabetes, Oramed is seeking to replace or reduce insulin injections before meals with its ORMD-0801 in order to achieve better control of blood sugar levels.

In a Phase 2a study with 25 Type 1 diabetes patients, the company administered ORMD-0801 three times a day before mealtime. Mr. Hexter says the study demonstrated that oral insulin successfully reduced injectable insulin requirements.

“We achieved encouraging trends in key areas versus placebo, including decreased use of rapid-acting insulin, and lower levels of post-meal glucose and daytime glucose,” he adds.

The company is currently seeking guidance from its scientific advisory board and key opinion leaders in the area of Type 1 diabetes about the next steps in its clinical program.

Oramed also is advancing another drug candidate, ORMD-0901, an oral glucagon-like peptide-1 (GLP-1) analog for Type 2 diabetes.

GLP-1 can successfully control blood glucose levels while minimizing the risk of hypoglycemia. GLP-1 also promotes weight loss, which is of major benefit to many Type 2 diabetics. However, GLP-1 therapies are currently only administered by injection.

Mr. Hexter says Oramed submitted a pre-IND package to the FDA and is in the midst of toxicology studies with ORMD-0901 as well as a small proof-of-concept study in Israel. In an earlier study, ORMD-0901 successfully raised insulin production in four healthy volunteers following a glucose challenge.

“Our plan is to move into a Phase 2b study in the U.S. by the third quarter of 2016,” he adds.

Oramed Product Pipeline

Oramed Product Pipeline