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IntelGenx is developing two platform technologies; one is a
Tri-Layer Tablet technology that allows for the development of oral controlled release
products, and the second is a breakthrough Quick Release Wafer technology that is intended
for the rapid delivery of pharmaceutically active substances
Healthcare
Biotechnology
(IGXT-OTC: BB)
IntelGenx Technologies Corp.
6425 Abrams
Ville St-Laurent (Quebec) H4S 1X9
Phone: 514-331-7440
Horst Zerbe
President and CEO
Interview conducted by:
Lynn Fosse, Senior Editor
CEOCFOinterviews.com
January 4, 2007
BIO: Horst G. Zerbe, Ph.D.,
President and CEO, has more than 20 years experience in the pharmaceutical
industry. Prior to founding IntelGenx, he served as the president of Smartrix Technologies
Inc. in Montreal, and as Vice President of R&D at LTS Lohmann Therapy Systems in West
Caldwell, NJ. He has published numerous scientific papers in recognized journals and holds
over 30 patents. He is one of the co-inventors of the edible film technology.
Company Profile: IntelGenx Corp. is a drug delivery
company established in 2003 and headquartered in Montreal (Quebec), which focuses on the
development of oral controlled-release products for the generic pharmaceutical market.
IntelGenx currently has two unique, proprietary platform technologies that it uses to
develop products: a Tri-Layer Tablet technology which allows for the development of oral
controlled release products, and a Quick Release Wafer technology for the rapid delivery
of pharmaceutically active substances to the oral cavity.
IntelGenx’ business strategy is to develop
pharmaceutical products based on its proprietary drug delivery technologies and license
the commercial rights to competent partner companies once the viability of the product has
been demonstrated. The company focuses on lifecycle management opportunities of existing
blockbuster products using the 505(b)(2) approach to obtain FDA approval.
IntelGenx Corp. has established a strategic
partnership with Keata Pharma Inc., a wholly owned subsidiary of PharmEng International
Inc. based in Markham, Ontario. Under this partnership, Keata Pharma provides
pharmaceutical manufacturing services to the company and promotes IntelGenx’ product
development services to interested pharmaceutical companies.
CEOCFO: Mr.
Zerbe, what was your vision when you started the company and how are you getting there?
Mr. Zerbe: “For a number of years, the
drug delivery industry has been growing quite rapidly, and a number of small R&D
companies have emerged that offer development services utilizing specialized delivery
technology. We started IntelGenx in 2003 with the vision of developing pharmaceutical
products for the pharmaceutical industry based on our proprietary oral drug delivery
technology and become a recognized provider of breakthrough technology to this
industry.”
CEOCFO:
You recently became a public company; why is this the time to make that change?
Mr. Zerbe: “We became a public company
in conjunction with a private placement that we completed earlier this year. Up to that
point, I had funded the company out of my own pocket, but we needed to raise more money in
order to support the projects that we had under development at that time. The raise was
done in the form of a private placement and a subsequent reverse takeover, in the course
of which we merged with a publicly traded shell company.”
CEOCFO:
Will you tell us about the platform delivery technology?
Mr. Zerbe: “We have two platform
technologies; the first involves multi-layer tablets and uses controlled erosion of
inactive cover layers as a mechanism to control the release of the active drug from a
non-erodible plastic core. This technology was designed to provide zero-order release and
is applicable to a large number of pharmaceutically active drugs, particularly to drugs
that are highly water-soluble. We developed this technology in order to compete against
relatively expensive technologies, like osmotically controlled systems that involve more
complex mechanisms to provide zero order drug release.
The second technology is a breakthrough technology. We have developed instantly
disintegrating film strips into which we incorporate certain pharmaceutically active
compounds. These film strips have certain unique properties compared to conventional oral
delivery systems, like extremely fast onset of action, because they melt rapidly in the
oral cavity. They can also be used to increase the bioavailability of drugs that undergo a
so-called first-pass effect when given the conventional oral route. This delivery system
is particularly suitable for indications that are characterized by sudden attacks, like
migraine.”
CEOCFO:
What is your business strategy regarding partnering?
Mr. Zerbe: “Our business strategy is
two-fold. We have a number of projects that are partner-funded. We usually approach
potential clients – or are approached by clients - at a relatively early stage of the
product development in order to enter into a co-development and licensing agreement under
which our partner holds exclusive rights for the commercial exploitation of the products
developed under the agreement. Usually our products require specialized manufacturing, so
we retain manufacturing rights for the products. Our revenue model is such that we receive
development fees and milestone payments during the development and royalties on product
sales upon commercialization of the products. In addition, we may receive manufacturing
revenues. On the other hand, we have a certain projects that we fund ourselves up to a
point where we can demonstrate that we have a viable product. This typically involves that
we conduct our own biostudies prior to approaching potential partners for a co-development
agreement. This strategy leaves IntelGenx with some of the development risk, but on the
other hand, offers a much higher reward potential.”
CEOCFO:
You have a broad product line; will you tell us about the areas you are addressing?
Mr. Zerbe: “We work on smoking
cessation, depression, pain management, osteoarthritis, and hypertension. However, our
technology is independent from the intended indication. Its suitability depends more on
the physico-chemical properties of the drug candidate.”
CEOCFO:
Will you touch on the advantage of working with drugs that have already been used?
Mr. Zerbe: “The development risk of
generic products is relatively low because of the known safety profile of the drug. This
is one advantage of working with generic drugs. A second, and probably more important
aspect of working with generic drugs is that the brand companies try to increase the
exclusivity of their proprietary drugs by developing second-generation products that
involve proprietary drug delivery technology. Since this effort is aimed at extending the
lifetime of the product, this strategy is being referred to as lifecycle management. A
product containing a known drug in a new format, like a new formulation, dosage form, or
strength, is regulated under paragraph 505(b)(2) of the Food, Drug, and Cosmetics Act.
Products that are approved under paragraph 505(b)(2), receive 3-5 years of market
exclusivity upon market entrance. This is a very interesting opportunity for
pharmaceutical companies for lifestyle management. IntelGenx has identified a number of
such 505(b)(2) opportunities which will be made available to interested pharmaceutical
companies for co-development and in-licensing.”
CEOCFO:
Why should potential investors be interested and what might people overlook that should be
understood?
Mr. Zerbe: “An investor looks at the
risk/reward ratio, and since we are working with known drugs where the risk of unknown or
un-expected side effects is actually nonexistent, we are operating in a low-risk area.
Therefore, an investment in our company would be relatively safe. On the other hand, there
is also a pretty high reward potential, because our pipeline contains projects that have
blockbuster potential. We have a diversified product and technology portfolio. I think
that under growth management considerations, we should be a very interesting
candidate.”
CEOCFO:
In closing, what should we look for two or three years down the line for IntelGenx?
Mr. Zerbe: “I would expect us to be a
recognized provider of high-end oral drug delivery technology, and we are confident that
our valuation will reflect that.”
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