Nabi Biopharmaceuticals (NABI-NASDAQ)
April 23, 2010 Issue
The Most Powerful Name In Corporate News and Information
Nabi Biopharmaceuticals Is Offering Hope To People Addicted To Cigarettes With Their Smoking Cessation Vaccine, NicVAX®, That Stimulates The Body’s Immune System To Produce Antibodies That Help Protect Against The Addictive Properties Of Nicotine Thereby Helping Them Quit Smoking
Nabi Biopharmaceuticals leverages
its experience and knowledge in powering the immune system to develop
products that target serious medical conditions in the areas of nicotine
addiction and gram-positive bacterial infections. Nabi Biopharmaceuticals is
currently developing NicVAX® (Nicotine Conjugate Vaccine), an
innovative and proprietary investigational vaccine for treatment of nicotine
addiction and prevention of smoking relapse. The company is headquartered in
President and Chief Executive Officer
Dr. Fahim is President and Chief Executive Officer of Nabi Biopharmaceuticals. He most recently served as Chief Operating Officer and General Manager. In May 2003, he was named Senior Vice President, Research, Technical and Manufacturing Operations of Nabi Biopharmaceuticals and was Vice President of Vaccine Manufacturing Operations upon joining Nabi Biopharmaceuticals in March 2003. His career includes 14 years with Aventis Pasteur from 1987 to 2001, where he was instrumental in developing several vaccines from early research to marketed products. During his tenure there, he held the positions of Vice President, Industrial Operations; Vice President, Development, Quality Operations and Manufacturing; Director of Product Development; and head of bacterial vaccines research/research scientist. During the year prior to joining Nabi Biopharmaceuticals, Dr. Fahim was an independent consultant, working with Aventis Pasteur and other companies worldwide on projects that included manufacturing, process improvement, quality operations and regulatory issues. From 2001 to 2002, he served as President and Chief Operating Officer of Lorus Therapeutics, Inc., a Toronto-based biopharmaceutical company focused on the research and development of cancer therapies. Dr. Fahim received his Ph.D. in Biochemistry from the University of Toronto.
by: Lynn Fosse, Senior Editor, CEOCFOinterviews.com, Published - April 23,
Dr. Fahim: As I took the leadership of the company, the company had just sold its revenue generating assets to Biotest AG of Germany. At that time, Nabi was not very focused on the assets it was developing and accordingly the value of the company was not where it should be in view of management, the board and its shareholders. Shortly after I was named President and CEO, we initiated a strategic alternatives process that focused on enhancing shareholder value through partnering, selling, merging, or licensing its pipeline of vaccine programs. This is because we had promising research and development vaccine candidates but we did not have the resources to commercialize them ourselves. What we have done over the past couple of years is to add value to these promising R&D programs by reducing the clinical, regulatory and commercial risk. This increased the attractiveness of our R&D programs and we successfully completed our strategic alternatives process. We sold our vaccine in development against Staphylococcus aureus or S .aureus (PentaStaph) and licensed our smoking cessation vaccine (NicVAX) to one of the largest pharmaceutical companies in the world, GlaxoSmithKline (GSK). As a result, our share price has appreciated significantly over the past few months and hence we enhanced shareholder value.
CEOCFO: Powering the immune system is your objective; how do you do that?
Dr. Fahim: We develop vaccines, which are products that when administered produce specific immune response against foreign unwanted invaders. This is the reason why our vision indicates that we power the immune system. As an example, humans are not always able to defend themselves effectively against diseases and infections like influenza, measles and diphtheria, but when vaccines against those agents are administered, the immune system is empowered to defend itself against those foreign invaders. Nabi is developing several vaccines that address significant unmet medical needs. As I mentioned earlier, we recently sold PentaStaph, which is a vaccine against S. aureus and licensed NicVAX, which is a vaccine for smoking cessation to GSK. On its own, our body may not be able to defend itself against S. aureus, which is one of the most notorious bacteria known to man, but with PentaStaph, humans may have a better chance to protect themselves against the bacteria. NicVAX is a vaccine for the treatment of nicotine addiction and the prevention of smoking relapse. As you know, smoking is one of the toughest addictions and habits to break and what we are doing is developing a vaccine that helps your body produce antibodies to protect itself against the nicotine in tobacco and therefore help smokers to quit.
CEOCFO: Is this approach to developing a vaccine being widely looked at, or is it novel to Nabi?
Dr. Fahim: NicVAX is very novel. This is clearly an innovative and somewhat radical idea. There is not anything like it. A few other companies are trying to do what we are doing, but they are far behind us in development. We certainly pioneered this approach, and we certainly have advanced it further than anyone else has. We are currently in Phase III, which is the last stage before licensure. The idea of a vaccine for smoking is completely different from any current therapy to help people stop smoking. Among current approaches are nicotine patches and gums, but all of these deliver nicotine to the brain from a different source. In other words, instead of getting nicotine from tobacco, you get it from the gum or the patch. The other current popular approaches include drugs that actually go into the brain and block the access of nicotine to its receptors in the brain. NicVAX works in an entirely different way. It is not a nicotine alternative and it does not go to the brain at all; it actually works in the blood system. NicVAX elicit your immune system to produce antibodies to nicotine, so the next time you smoke the antibodies will capture the nicotine in the blood and prevent it from going to the brain.
CEOCFO: What does Nabi know about making vaccines that perhaps other do not?
Dr. Fahim: We actually have developed quite a bit of knowledge and have accumulated quite a bit of vaccine expertise inside the company. We have deep knowledge of vaccines in general and specifically a conjugate vaccine technology. The reason this technology is important is that there are agents that our immune system does not recognize as foreign such as certain carbohydrates or sugar molecules in some bacteria or nicotine in tobacco. These agents can harm us without our bodies defending itself against it since it does not recognize it as foreign. Through conjugate vaccine technology, we bind these foreign non-immunogenic agents to highly immunogenic proteins, which then allows the immune system to produce antibodies to both the proteins and the foreign agents. For example, when one smokes, nicotine in tobacco, which is a very small molecule that our bodies cannot recognize as foreign, continues to do harm to us without the body defending itself against it. The conjugate technology forces the body to recognize these agents as foreign after immunization and produce antibodies to nicotine, because we link the nicotine to a much bigger molecule that the body recognizes as foreign. In other words, we trick the body into recognizing nicotine as foreign. The next time the person smokes, the antibodies will capture the nicotine, keeps it in the blood and makes it harmless as it prevents its access to the brain. In the case of S. aureus, these bacteria, which are coated with sugars that our bodies don’t recognize as foreign, can, harm us without our body defending itself against it. Again, we conjugate the bacteria with an immunogenic protein to trick the body into recognizing the sugars as foreign and hence protect ourselves against the bacteria. This technology combined with know-how gives us an edge in the vaccines we are developing. Moreover, we focus on developing vaccines that address significant unmet medical need. In other words, we are not developing yet another flu vaccine like tens of other companies. We try to find important areas of medical need that are not being addressed. Hence, we pioneered S. aureus vaccines and we are the first to develop a vaccine for smoking cessation to reach a phase III clinical stage. This is what makes us unique.
CEOCFO: What is in the pipeline and what is ahead for Nabi?
Dr. Fahim: We continue to develop NicVAX after we have successfully divested PentaStaph. As I mentioned, we are in Phase III with NicVAX, so we are focusing all of our attention now to completing the development of that vaccine in order to realize its full value. We think NicVAX is a very innovative product with a market that has blockbuster potential.
CEOCFO: What is the timeframe?
Dr. Fahim: In accordance with the FDA requirements, we need to conduct two large Phase III clinical trials, each one enrolling one thousand subjects. We anticipate that we will finish both Phase III trials, in the first half of 2012 and then we submit for licensure.
CEOCFO: What is the financial picture like today for Nabi Biopharmaceuticals?
Dr. Fahim: We are one of the very fortunate companies in that we have enough cash to develop NicVAX. Based on our year-end 2009 financial statements, we had approximately $119 million in cash. That gives us ample cash to develop the products we have. In addition, in 2010, we received $40 million from the NicVAX license agreement with GlaxoSmithKline as well as an $8 million milestone payment associated with the sale of PentaStaph so we have something in the neighborhood of $160-$170 million as we talk today. Because of our healthy cash balance, we recently announced an effort to return equity to shareholders in the form of a $61 million share repurchase program.
CEOCFO: Has the investment community been paying attention?
Dr. Fahim: More recently yes. With our success in divesting and licensing our programs to GSK, which is one of the biggest and most respected pharmaceutical companies in the world, the investment community realized that Nabi is doing something unique and started to look much more closely at us. We have been getting many requests for information about the company from the media and from current and potential investors.
CEOCFO: In closing, why should investors pay attention to Nabi Biopharmaceuticals?
We clearly have a product that is unique and has blockbuster potential. A
third party market research company estimated that smoking cessation
vaccines could generate about $2 billion is annual revenue and we are the
only company in the world that has a smoking cessation vaccine at this stage
of development. That is why, a large pharmaceutical company like
GlaxoSmithKline has decided to license this product from us. Moreover, we
have plenty of cash and are prudent in spending it. Therefore, we can
develop the products we have without additional external funding. Many
biotech companies may have great products, but they do not have the cash to
develop them. Nabi has the cash, it is using it wisely and has a unique late
stage development product with blockbuster potential. That is why new
investors should be looking at Nabi. We think we are unique in our space.
Many biotech companies may have great products, but they do not have the cash to develop them. Nabi has the cash, it is using it wisely and has a unique late stage development product with blockbuster potential. That is why new investors should be looking at Nabi. We think we are unique in our space. - Dr. Raafat E. F. Fahim, Ph.D.
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