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In pharmacology, we don't only have to consider the actions of the drug on the body. It is also important to understand the way the body processes the drug, or the pharmacokinetics. When you consider that drugs, like the nutrients in food, must be absorbed (A), distributed (D) throughout the body, metabolized (M), and excreted/eliminated (E), pharmacokinetics becomes a critical consideration in drug development. Investors with a keen eye can watch for drugs with innovative ADME profiles and better understand their competitive advantages over comparable therapies.
Here's a breakdown of just a few companies profiting, or struggling, with the ADME profiles of their drug candidates:
Absorption typically refers to the route by which the drug reaches the bloodstream, and is largely dependent on chemical parameters such as a drug's solubility, acidity, and size. These factors dictate the mode of application (oral, topical, IV, etc.) of the drug. Optimizing a drug candidate's absorption properties can allow a company to produce drugs that are much more convenient for patients.
MannKind (NASDAQ: MNKD ) is one company exploiting this pharmacokinetic property with an exciting technological advancement. MannKind's Afrezza is aimed at acutely treating both type 1 and type 2 diabetes using the traditional approach: insulin. As a protein, insulin cannot be absorbed through the gut, and it has been classically dosed as an injection or implantable pump for chronic use. Novo Nordisk's (NYSE: NVO ) Novolog, for example, is a standard injectable therapy that is part of the company's cornerstone insulin analog franchise.
Afrezza, unlike Novolog, is an inhalable insulin therapy that has shown comparable efficacy to Novolog and also enhanced safety with a decreased likelihood of hypoglycemia (though a reduction in "severe hypoglycemia" was not significant). What truly underlies the excitement behind this therapy is the pharmacokinetic profile.
MannKind's unique technology has allowed the company to optimize the pharmacokinetics of standard insulin therapy and in a much more comfortable way for the patient. Rather than frequent injections, patients can rely on a single-use inhalable delivery system the size of a thumb drive for fast-acting insulin. Even with Afrezza's modest clinical trial data, approval from the Food and Drug Administration could spell gains for shareholders because of its comparative advantage over injectable peers.
Once in the blood, drugs are capable of distributing to different compartments, or tissue types, based on their chemical properties. The blood-brain barrier, for example, prevents some drugs from entering the cerebrospinal fluid and affecting the central nervous system.
Part of the explosion of oncology stocks recently is the excitement surrounding tissue-directed therapeutic agents. Several companies have developed the technology to chemically link a chemotherapeutic drug to an antibody that binds specifically to tumor cells. In that way, tissue distribution of the drug can be optimized by the design of the antibody, rather than carpet-bombing the body with toxic drugs.
Seattle Genetics (NASDAQ: SGEN ) is an established company with proprietary antibody-drug conjugate, or ADC, technology. Unlike some of its peers, Seattle has recognized significant revenue from sales of an ADC, with Hodgkin lymphoma drug Adcetris bringing in $138 million in 2012. Adcetris uses an antibody that targets its drug specifically to immune cells associated with several types of lymphoma. The company continues to innovate with 12 collaborative efforts supporting a pipeline of 19 clinical-stage drug candidates.
This is where many drugs run into trouble. The liver contains hundreds of variations of metabolic enzymes responsible for degrading nutrients and drugs. This metabolism is important to deactivate (or sometimes activate) molecules in the body to be efficiently converted into energy or excreted. The liver has evolved to increase or decrease the levels of these enzymes, depending on their usage. But when drugs inadvertently cause these enzyme levels to change, the resulting liver toxicity can result in dangerous side effects.
Of the more recent high-profile drugs to be scratched from late-stage trials because of liver toxicity was Eli Lilly's (NYSE: LLY ) BACE inhibitor LY2886721. Lilly's treatment for Alzheimer's was in a phase 2 trial when routine blood tests showed abnormal liver function -- thought to be an off-target side effect. At the time, Lilly was part of the blockbuster race with big-name competitors Merck and AstraZeneca. Now Lilly is left with a smaller Alzheimer's pipeline, and the drug solanezumab is in clinical trials. The company is attempting to start fresh with a new preclinical approach.
Once a drug reaches the bloodstream, it is often filtered out by the kidneys to be expelled in the urine. Kidney physiology is incredibly complex, playing roles in biological functions as diverse as blood pressure, heart rate, and regulation of blood acidity.
So when kidney function is disrupted due to diabetes, toxicity, cancer, heart failure, or any other number of renal ailments, an assessment of drug excretion can be critical to identifying populations at risk for side effects. Often, drugs that are excreted through the kidney are contraindicated in elderly or otherwise sick patients. This is particularly the case with antibiotic or chemotherapeutic agents, which often undergo renal excretion and are affected by age. Other modes of elimination, such as biliary (liver) elimination or exhalation, may show diminished risk of renal toxicity.
The big idea
Understanding pharmacokinetics can be a useful tool for investors as they watch drugs develop through the pipeline. The importance of pharmacokinetics, especially metabolism, is not limited to the examples above. In some cases, these properties can give drugs a strong competitive advantage as they enter the market. In others, they can cause the downfall of a promising therapy before even hitting the market. Include an ADME analysis with your next SWOT analysis, and maybe you'll have a leg up in finding the next big blockbuster to invest in.
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