From Needle To Nose

First, there's the brilliant idea: figure out a way to inhale insulin, so diabetics can ditch the dreaded needle. But then comes the long slog to market. For John Patton, cofounder and chief scientific officer of Nektar Therapeutics in San Carlos, Calif.--and a pioneer in the technology known as pulmonary or inhaled-drug delivery--the journey began in 1990. Early on, big drug companies were reluctant to invest in a new approach. More important, there were major technological challenges. But now, as the inhaled version of insulin he helped develop (brand name: Exubera) makes its way through final testing, Patton will soon face the business moment of truth: will the Food and Drug Administration deem it safe enough to send to market? Patton, 56, is antsy, but he's also confident. "I'm not overstating it when I say this has the potential to be the biggest change in drug delivery ever," he says.

Diabetes is an ideal place to start the revolution--and perhaps to cash in. The disease, which breaks down into two main forms (type 1 and type 2), affects 17 million Americans and 176 million people worldwide--a number expected to double by 2030, thanks to an aging population and increasing obesity, a risk factor for diabetes. Until an artificial pancreas is available (biotech is working on that, too), patients must rely on insulin injections to keep glucose levels in check. Last year alone, global sales of the hormone rang in at $4.6 billion and are likely to increase by 5 percent to 10 percent a year, according to the pharmaceutical research firm Decision Resources.

Those numbers are especially enticing to investors. And finding alternative ways to get drugs to patients--making medicine easier to use--has become highly competitive. "Drug delivery is a very viable investment opportunity," says Dr. Paul Auerbach, a partner at Delphi Ventures in Menlo Park, Calif., in the heart of Silicon Valley. It's no surprise, then, that Patton, whose company is partnered with Pfizer and Aventis, isn't alone in the race. The competition: biotechs Aradigm of Hayward, Calif., and Alkermes of Cambridge, Mass., along with their big-pharma collaborators, Novo Nordisk and Eli Lilly. If the FDA approves an inhaled version of insulin--which could happen anywhere from a year to three years from now "it will open the floodgates for other drugs," says pharmaceutical analyst David Steinberg of Deutsche Bank Securities. Such medications could include treatments for pain, influenza and sexual dysfunction.

Insulin injections aren't necessarily that painful; the fear can be worse than the reality. And even if inhaled insulin makes it to market, injections won't become obsolete soon. That's because many diabetics need both short- and long-acting versions of insulin, and the new technology, for now, delivers only the former. Still, most diabetics--and certainly those with type 1, in which the pancreas stops making insulin altogether--would be happy to rid themselves of some of the several needles they need daily. The new approach might also increase compliance among type 2 diabetics (their pancreas produces insulin, but the body fails to use it properly), who make up about 90 percent of the patient population. In recent years, doctors have begun promoting insulin treatment earlier in the course of type 2 disease in hopes of avoiding long-term complications like blindness and kidney failure. Because of needle anxiety, an inhaled insulin "might be an easier, faster way to get [patients] onto insulin," says Dr. Fran Kaufman, head of the American Diabetes Association.

Patton thinks so. He's been committed to it since he left his job in 1990 as head of drug delivery at Genentech and cold-called venture capitalists with physicist and cofounder Bob Platz to launch Nektar (originally called Inhale Therapeutic Systems). With his tan face and tousled gray hair, faded jeans and love of surfing, Patton is about as non-geeky as scientists come--a quality that helped him win an initial $650,000 investment from Onset Ventures, a venture-capital firm in Menlo Park, Calif. "He is special," says Onset's Terry Opdendyk. "Without John--his personality, his perspective, his skills--I would not have done the deal." Patton's schooling in the biological sciences was key, but Onset was also impressed by Patton's diverse interests and his impatience with dillydallying. "He has an intellectual honesty that prohibited b.s.," says Opdendyk.

The idea of inhaled insulin dates to the 1920s, when the hormone was first isolated as a treatment. But moving from needle to nose is no easy task. Insulin is made up of large molecules that have to be re-engineered into particles small enough to travel through the airways and settle deep in the lungs, where they can be absorbed into the bloodstream. And there's the precise science of dosing: too much or too little insulin can cause dizziness, nausea and even shock. Companies pursuing inhaled delivery are using different forms of the insulin (Pfizer's is a dry powder, Novo Nordisk's is wet), as well as various devices for inhaling. It's too early to know which will prove best.

So far, clinical trials of Exubera's inhaled insulin, which has been tested on more than 2,500 patients, suggest the therapy works. In data reported by Pfizer, Exubera's control of glucose levels was similar to that achieved with injected insulin. And earlier trials of competitors' products are suggesting comparable findings, though the testing is in initial phases. Patients have been happy with the product; according to Dr. Alan Moses of the Joslin Diabetes Center in Boston, who helped design some of Pfizer's early trials, they "thought it was the best thing since sliced bread."

Still, as Moses and other diabetes experts are quick to point out, safety will be the FDA's biggest concern--especially since a perfectly good version of the drug already exists. The agency will "have a fairly low tolerance for adverse effects," says Moses. Data so far have shown that some patients taking Exubera developed antibodies to insulin; injections can cause the same response, though, and whether that will affect patients in the long term is unknown. Some patients also experienced coughing after inhaling insulin, suggesting irritation. But perhaps the most problematic issue is the long-term effect of sending insulin to the lungs several times a day. Animal studies, which so far have shown no lung damage, are reassuring. But the jury is still out on humans. In trials completed last year, Pfizer and Aventis found small decreases in lung function in patients taking Exubera. Last fall the companies announced they would perform additional long-term safety studies to clarify the data before they apply for FDA approval.

Competitors are watching. One biotech, Aerogen of Mountain View, Calif., has put its inhalant technology on the back burner until executives know the outcome of Patton's product. Drug companies won't say precisely how much they've spent on developing inhalant technology, but with the typical cost of moving a drug from lab to clinic at $800 million, big financial positions have clearly been taken. The industry is working hard to "make sure, as a class, this thing doesn't fall down," says Rick Batycky of Alkermes, the biotech partnered with Eli Lilly. "We want to establish the safety for the next generation of molecules." The drug companies insist they're strongly committed to a technology that offers patients a choice. "We want insulin therapy for every kind of person," says Mads Krogsgaard Thomsen, chief scientific officer for Novo Nordisk. There's also the profit motive: because of the technology required for preparation, inhaled insulin will no doubt cost more than injections, which are a couple of dollars a shot.

The FDA will have the last word. In the meantime, other insulin delivery systems, including a patch and pill, are being studied. Portable insulin pumps, which deliver the short-acting variety of the drug, have been on the market for years. And pancreatic cell transplants are in trials. For John Patton, inhaled insulin is the best answer. "I'm not going to quit until it's on the market and being used," he says. "I really don't mean to sound arrogant, but I can see the future." Those are the words, and sentiments, of a true entrepreneur.