Bristol-Myers Squibb will re-enter the radiopharmaceutical business via the acquisition of DuPont Pharma.

While Bristol's most obvious product attraction to the DuPont business is in the HIV therapy market, the company also pointed to DuPont's radiopharmaceutical line as a valuable asset.

DuPont markets Cardiolite (technetium Tc99m sestamibi) for detecting coronary artery disease. The same agent is also marketed for breast cancer screening under the trademark Miraluma. Sales of the product in 2000 were about $270 mil.

The imaging business will help support Bristol's cardiovascular and oncologic therapeutic franchises.

Cardiolite "fits very nicely into our own cardiovascular franchise and complements a lot of things that we are doing with Plavix and Pravachol," Worldwide Medicines Group President Richard Lane told analysts June 8, the day after the DuPont transaction was announced.

Bristol is re-entering the imaging agent market seven years after selling Squibb Diagnostics to Bracco.

Lane declined to comment on why Bristol left the business at that time. "I wasn't here," Lane said, "so I really can't comment on that one."

However, he said, the imaging agent business is attractive now.

Bristol "looked very carefully at the radiopharm business. I think it is a really solid business, nice strategic fit, good margins, good growth prospects and we intend to keep that business," Lane added.

Bristol's winning bid for DuPont Pharma was $7.8 bil. in cash, or about 5.2 times the $1.5 bil. in sales recorded in 2000 (¹ Also see "Bristol/DuPont Is Timely Deal: Will Disrupt Difficult 2002, Add To 2003" - Pink Sheet, 11 June, 2001.).

DuPont's largest product is the HIV drug Sustiva (efavirenz). Bristol touted the synergy between Sustiva and the company's current HIV treatments Videx (didanosine) and Zerit (stavudine).

"With Sustiva in our HIV portfolio, we expect to accelerate the growth of Zerit and Videx as well as Sustiva itself," Lane said.

Bristol CEO Peter Dolan noted that Sustiva "is something we've been interested in for quite some time."

Sustiva generated sales of $386 mil. in 2000. Videx and Zerit combined for over $800 mil. in worldwide sales last year, but growth was minimal.

A pending application for once-daily use of Sustiva is particularly appealing for Bristol.

"Pending FDA approval of our protease inhibitor [BMS-232632] and pending approval of once-daily Sustiva which was filed in April, BMS will be the only company with once-daily compounds in all three classes of HIV therapy," Chief Scientific Officer Peter Ringrose, PhD, said.

In October, Bristol received approval for an enteric-coated once-daily capsule version of Videx; the formulation recorded sales of $54 mil. for 2000.

"With the addition of Sustiva, and our own once-a-day protease inhibitor which will be filed in Europe later this year and in the U.S. next year, we will be able to offer the highest quality treatment with the broadest range of therapies anywhere in the world," Ringrose declared.

Merck markets efavirenz in most markets outside the U.S. Merck originally discovered the product and contributed it to its 1990-1998 joint venture with DuPont.

DuPont has a successor non-nucleoside reverse transcriptase inhibitor, DPC 083, in Phase II. The compound is scheduled to move into Phase III in the third quarter. During an April analysts briefing, DuPont reported that DPC 083 has a four day half-life, and projected an NDA filing for 2003 (² Also see "DuPont Oral TNF Inhibitor For Arthritis, Sustiva Successor Are In Phase II" - Pink Sheet, 16 April, 2001.).

Bristol will also add the NNRTI DPC 817 to its pipeline. The 13 to 17 hour half-life of DPC 817 "virtually ensures that it can be given once a day," DuPont said.

DPC 817 is in Phase I, with Phase II expected to begin in the first quarter of 2002. An NDA filing is slated for 2004.

The HIV therapy area looks like the only product overlap that could potentially raise antitrust issues for the acquisition. However, the large number of competitors in the different HIV subcategories probably makes the possibility of divestments remote.

DuPont's third-largest product is the off-patent anticoagulant Coumadin (warfarin), with sales of about $260 mil. in 2000.

With Coumadin, Bristol will enhance its image as the leading anti-generic strategist within the brand name sector; it inherits DuPont's efforts to limit substitution via state formulary board and legislative actions.

"We believe the outlook for this brand is good in spite of the mature stage of its life cycle," Lane said. "The narrow therapeutic window of the drug, and the physician loyalty...should mitigate the typical generic erosion trends."

Bristol is projecting a "mild" decline in Coumadin sales. "We have built into our financials realistic expectations that this product will decline at mild rates over the next several years, rates that are consistent with the experience we've seen with other narrow therapeutic index products where bioavailability is an issue and substitution tends to be lower."

Bristol's "mild" decline projection hinges on two factors: "narrow therapeutic index drugs require careful titration and monitoring throughout the course of therapy, and physicians and pharmacists have traditionally been less likely to allow substitution for these kinds of compounds," Lane said.

Generic warfarin manufacturer Barr recently won a round against DuPont when the Florida state senate decided to eliminate the restriction on generic substitutions (³ Also see "Barr Generic Tambocor Launch Planned For Fall Following Win In Patent Case" - Pink Sheet, 14 May, 2001.).

Barr and DuPont have been in litigation over warfarin. As part of the settlement, DuPont paid Barr for co-promotion rights to several products (⁴ Also see "DuPont/Barr Enter Into Legal Truce With Five Product Promotion Accord" - Pink Sheet, 24 January, 2000.). Bristol said it has not yet determined whether those products will be transferred with the acquisition or returned to Barr.

Ringrose highlighted two of the "20 or so" DuPont R&D projects during the briefing: oral Factor Xa inhibitor anticoagulants and corticotrophin-releasing factor receptor antagonists for depression and anxiety.

"Well before this acquisition was even considered, we had been tracking and following these compounds as ideal agents for possible in-licensing or codevelopment arrangements," Ringrose said.

The Factor Xa antithrombotic will initially be "used in the prevention of thrombosis during joint replacement procedures," Ringrose said, "but ultimately it could prevent stroke in patients with arterial fibrillation as well as treating patients with venous thrombosis," Ringrose said. The lead candidate DPC 906, is in Phase II, and Bristol hopes to file an NDA in 2004.

"This is an area that BMS has been active in and interested in for some time, but has found it completely difficult to find optimized molecules for development," Ringrose said.

"We are therefore impressed with how the DuPont research team has identified leads and optimized the DPC 906 molecule for advanced clinical development."

The antithrombotic "has the potential to complement our Plavix antithrombotic in the treatment of arterial thrombosis," Ringrose added.

CRF-receptor antagonist research "has also been a focus of BMS research for a number of years," Ringrose said.

DuPont's Phase I candidate DPC 368 "has a novel mechanism of action, and has the potential for providing significant advances over current therapies in the treatment of depression and anxiety, and importantly could offer advantages over the SSRIs," Ringrose said. Bristol believes DPC 368 could reach the NDA stage in 2005.

Ringrose mentioned four additional DuPont projects: (1) a Phase I CCR3 receptor antagonist for asthma and allergic rhinitis; (2) a Phase I oral TNF-alpha inhibitor for arthritis; (3) a preclinical selective serotonin 2C partial agonist for obesity; and (4) a Phase I selective estrogen receptor modifier for breast cancer.

Bristol CEO "Peter Dolan's strategy for growth is an acceleration of our already rich and productive pipeline," Ringrose observed. "We intend to apply the same sense of urgency to optimizing and adding further value to the DuPont pipeline."

Bristol Buys DuPont: Re-Enters Imaging Agents, Adds To HIV Line

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