Companies at AAO meeting eye future of ophthalmology

By Larry Haimovitch

Medical Device Daily Contributing Writer

October 29, 2009

SAN FRANCISCO — The annual meeting of the American Academy of Ophthalmology (AAO; San Francisco), the largest ophthalmic meeting of the year, provides physicians with an opportunity to learn about the latest clinical developments in their field. In addition, it is a venue for public ophthalmic companies to update the investment community and media about their most current information.

With the 2008 buyout by Warburg Pincus (New York) of the previously publicly-held company Bausch & Lomb (B&L; Rochester, New York) (Medical Device Daily, Oct. 29, 2007), and the more recent acquisition of Advanced Medical Optics (Santa Ana, California) by Abbott Laboratories (Abbott Park, Illinois) (MDD, Feb. 26, 2009), the ranks of public ophthalmic device companies has dwindled. Two of the remaining companies, STAAR Surgical (Monrovia, California) and Alcon (Fort Worth, Texas) both held informational meetings with the financial community during AAO.

Alcon's new president and CEO Kevin Buehler, who succeeded Carey Rayment in early 2009, emphasized that his company has a broad array of attributes that bodes well for its long-term future. These include attractive fundamentals of the ophthalmic market, favorable demographics, the crucial importance of good vision for a high quality of life and its broad product, payor and geographic diversity.

However, in spite of its myriad strengths, Buehler noted that the difficult economic trends, especially in the USA have had a negative impact on its business, especially in its pharmaceutical and premium IOL segments.

Moreover, despite some indications of improving trends, he said "we are not out of the weeds yet."

On Monday afternoon, Alcon reported that their "organic" third quarter global revenue, that is excluding the impact of foreign exchange fluctuations, increased by 9%. This represented an uptick from the first half of 2009, when growth was more tepid.

A key focus for Buehler since he became CEO has been to blend its own internal R&D efforts with external licensing, partnerships and acquisitions. Buehler and the company's senior vice president of R D Sabri Markabi, MD, appear much more open to outside opportunities than the previous CEO and head of R&D.

This attitude has been amply demonstrated in recent months by three key strategic initiatives in its pharmaceutical business, which accounts for approximately 40% of its global revenue:

  1. A deal with Astra Zeneca (London) that will give Alcon exclusive access to multiple classes of small molecules targeting glaucoma, retinal disease, ocular allergy and dry eye.

  2. A proposed acquisition for $150 million in cash, plus contingent payments of up to $439 million of privately-held ESBATech (Zurich). This deal provides Alcon with access to proprietary antibody fragment technology particularly suited to treat ocular diseases.

  3. An announcement during the AAO by Potentia Pharmaceuticals (Louisville, Kentucky) that it had entered into licensing and purchase option agreements with Alcon. Potentia is a privately-held biotechnology company that is developing medicines for the treatment of age-related macular degeneration (AMD) and this agreement provides Alcon with a license to develop Potentia's leading AMD drug candidate, POT-4.

In addition, during the AAO, Medical Device Daily confirmed with various industry sources that Alcon had been in active negotiations to acquire Visiogen (Irvine, California), which has developed an innovative, accommodating intraocular lens (IOL). Visiogen was ultimately snatched up by Abbott for more than $400 million (MDD, Sept. 4, 2009).

These developments indicate a significant departure from the conservatism of the previous regime and were reaffirmed by Buehler in a discussion with MDD after the meeting.

"We cannot rely solely on our internal R&D to bring new products to the market," said Buehler. "We must continue to actively search for products from outside our organization that can fuel our growth."

Alcon's internal innovation has brought improvements in its Infiniti phaco-emulsification cataract removal and its Constellation vitrectomy product lines. Alcon dominates both these markets, the former with a market share estimated by MarketScope (St. Louis) of 69% and the latter with a prodigious 84% share of the disposable vitrectomy pack business.

Despite its supremacy in these markets, it continues to innovate and thus strengthen its grip on these businesses. The Infiniti has been upgraded to provide better cutting (greater efficiency) with reduced heat (safer) while the Constellation has improved fluidics and can eliminate the need for sutures in the eye, a big comfort advantage for the patient.

Whereas Alcon's analyst meeting covered most aspects of its global business, STAAR's was narrowly focused on the early results from its Collamer Accommodating Study Team (CAST), which was formed by the company in late 2008 to provide initial patient vision assessments from the first phase of the project.

The CAST is comprised of eight prominent cataract/refractive surgeons who since mid-2009 have implanted more than 300 eyes with the STAAR single piece aspheric collamer IOL trade named nanoFLEX.

Although the nanoFLEX is marketed as a "standard" IOL, that is for the correction of distance-only vision, not intermediate (computer distance) or near (reading) vision, anecdotal observations have indicated that it may well have the ability to boost intermediate and near vision.

Indeed, the early results from the CAST trial, which was presented at the AAO and at STAAR's analyst gathering by James Lewis, MD, a highly-regarded cataract and refractive surgeon from Philadelphia, showed that the nanoFLEX does improve vision in these fields.

With four months of follow up data available on 73 binocular near vision patients (146 eyes) and 59 binocular intermediate vision patients (118 eyes), the outcomes indicate that nanoFLEX provides superior distance-corrected near vision compared with the leading standard IOLs and comparable results to current premium IOLs. The latter include FDA-approved lenses such as Abbott's Tecnis and ReZoom multi-focal IOLs and Alcon's ReSTOR.

In addition, the outcomes indicate that nanoFLEX provides superior distance-corrected intermediate vision to any IOL compared including premium IOLs.

Speaking to the analyst group, Lewis called these early results both "encouraging and compelling."

He added that he believes that in the standard IOL category, the nanoFLEX is clearly "best in class."

STAAR's product development team is engineering minor design changes to the nanoFLEX for the purpose of a second phase of CAST, which will include a clinical study by CAST members to determine whether these minor design changes can improve upon current results.

CAST will continue to follow all patient eyes implanted and within six months the company hopes to have preliminary data for the second phase, which will compare the accommodating performance of the existing nanoFLEX vs. the redesigned nanoFLEX.

Additionally, CEO Barry Caldwell indicated that STAAR plans to initiate a clinical trial aimed at obtaining a claim of accommodation or less spectacle dependence from the FDA. The plan is to complete that FDA trial in 18 months, at which point in time the company would submit a PMA supplement file to the FDA.

Retina late breaking clinical trials

At a "Late Breaking Development” session held in conjunction with the AAO's Retina Subspecialty Day, several interesting and promising approaches to the treatment of macular degeneration were presented.

In particular, the use of radiation as an adjunct to the gold standard of injecting anti-VEGF agents such as Lucentis or Avastin, both of which are manufactured by Genentech (South San Francisco, California), is showing great potential.

Pravin Dugel, MD, a managing partner of Retinal Consultants of Arizona (Phoenix) presented the results of the MERITAGE 1 trial. The trial employed a technique called epimacular brachytherapy, which incorporates a vitrectomy and the brief administration of a beta radiation source, strontium-90, to the macula.

The technology was developed by privately-owned, venture capital-backed NeoVista (Fremont, California).

The MERITAGE 1 study enrolled 50 patients, with the hypothesis that the addition of beta radiation could decrease the frequency of anti-VEGF injections and also improve visual acuity.

The study met both endpoints, as the number of injections six months after radiation decreased from an average of four per patient to two, while 63% of the patients gained additional visual acuity, with half the patients gaining 5 letters or one line on the reading chart more.

Dugel then noted that NeoVista's pivotal trial, dubbed CABERNET, recently completed its full enrollment of 450 patients. These results, which should support a PMA filing, are expected to be released in late-2010.

"We eagerly await the results of this important pivotal trial," said Dugel.

Another approach to using radiation to manage AMD was discussed by Peter Kaiser, MD, of the Cleveland Clinic Foundation (Cleveland). He presented early data on the IRay system a noninvasive, low-voltage, stereotactic radiosurgical device designed specifically for office-based ophthalmic use. IRay delivers a precise dose of radiation noninvasively through the sclera to the macula using a robotic positioning system, a proprietary localizing algorithm and a novel methodology for eye stabilization. It has been developed by privately-owned, venture capital-backed Oraya (Newark, California).

Oraya's feasibility trial has been conducted in Mexico and Kaiser reported on the results of the first 28 patients. Like NeoVista, its clinical data is showing that it both improves visual acuity and reduces the therapeutic burden with a reduction in the number of injections.

Oraya hopes to initiate its pivotal trial, which is unnamed as yet, in the first half of 2010. Oraya's new CEO Jim Taylor, former president of Carl Zeiss Meditec USA (Dublin, California) recently joked at a meeting last week that it would be called LIGHTBEER, a spoof on the wine-related names used by NeoVista.

2009 American Academy of Ophthalmology Meeting

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