Last Friday, Iconovo released its year-end report for 2019. The report highlights the company’s ability to make a large investment in their new inhalation platform ICOpre, as well as its opportunities to land on the US generic powder inhalation drug market. BioStock caught up with the company’s VP Business Development, Roger Lassing, to better understand what it all means for Iconovo in 2020.
The strong progress made by the Swedish inhalation device company Iconovo in 2019 was made clear in their year-end report. One of the main highlights of the report is the company’s forward-looking investment into a new inhalation platform that includes the ICOpre inhaler and corresponding dry powder formulations. The investment was made possible after the company raised 60 MSEK from a share issue directed at large institutional investors in November, with net proceeds of 56 MSEK.
Iconovo makes global bet with ICOpre
ICOpre represents a business opportunity for Iconovo in the development of generic versions of GSK’s Ellipta, which is expected to dominate the inhalation market for the next 10 years. Already by 2024, analysts expect the Ellipta range of products to be worth at least 5 BUSD in annual sales.
With Ellipta’s first patent expiring in 2025, Iconovo aims to be ready with a generic version by then, which is intended for a global market, including the US. The company has already seen an opening to enter the US market with ICOpre with the FDA approving Mylan’s Advair generic product Wixela Inhub last year.
The new inhalation platform joins the other products already in the company’s portfolio to treat diseases such as COPD and asthma: ICOcap, ICOres, and ICOone.
Management change coming up
The year-end report for 2019 also highlights Orest Lastow’s decision to step down as CEO of Iconovo to instead take on the role of CTO – a position he sees more fitting for him as the company starts developing the new ICOpre platform.
– “Having been CEO of Iconovo for over five years, I have seen the company grow from a small technology-intensive company to a listed company with a market capitalization of over half a billion SEK. Since I am basically a physicist and engineer, I see it as a natural development to now hand over to a person with a profile that is more suitable for a stock exchange CEO.”
See more reaction from Orest Lastow about the managerial change in the latest video interview with BioStock at the LSX World Congress in London two weeks ago.
Johan Wäborg will take over as new CEO on April 14.
BioStock was able to get in touch with Iconovo’s Vice President Business Development, Roger Lassing, to get a better understanding of the report’s significance and what it means for the company moving forward.
Roger Lassing, Iconovo finished 2019 with just over 89 MSEK in cash. Do you expect most of that to go towards the development of the new ICOpre platform?
– We only expect to spend 20 MSEK on the development of the ICOpre platform as such. With our current cash position, we have the financial freedom to pursue various development options that will benefit the business. It will be important to reach the market at the time of the first patent expiration for Ellipta, and, with such financial strength, we can have a focused development approach to deliver a complete inhalation product, meaning both the ICOpre inhaler and the first powder formulation, within that time frame.
Iconovo had a burn rate of 7,5 MSEK for Q4 2019, and 11,4 MSEK for the full year. You are now accelerating the ICOpre project amongst other advancements. How long is the 89 MSEK expected to last?
– Iconovo has three inhaler platforms, and we are well on our way to developing a fourth inhaler, ICOpre. We have continuous discussions with partners regarding the development of both generic and innovative inhalation products through all four of our platforms. Each potential collaboration would come with its own financial terms and costs, thus affecting our cash position, so we cannot give future guidance regarding burn rate.
Going back to ICOpre, how will it compare to GSK’s Ellipta?
– The handling of the device will be similar enough to Ellipta for it to qualify as an AB-rated generic in the US market, while at the same time having a technological design being different enough to steer clear from potential patent infringement. It means that Iconovo do not intend to make a plain copy of Ellipta, but rather develop our own design principles. As the device patents of Ellipta only expire in 2030, it is important to use different and proprietary design principles to be able to launch a Breo/Relvar generic in 2025, when the compound patents expire.
When do you expect to have an ICOpre prototype on hand?
– The total development time is expected to be three years for ICOpre. We will have a prototype available much earlier, but at this point in time I do not want to speculate when we can show it off to the world. It is a development project; however, you can rest assured that people will learn when we are ready to present the prototype to potential partners. We are already approaching various partners regarding their potential interest in pursuing this opportunity.
Do you expect stiff competition from similar generic products, like, e.g., Mylan’s Wixela Inhub?
– We are aware of several companies developing generic forms of the Ellipta inhaler. However, we do believe that generic products targeting Ellipta in the US market would need to design a special inhaler solution to be able to do so. Thus, we don’t feel that Wixela Inhub is an option for a generic Ellipta without redesigning the product. There are other development projects targeting Ellipta, but we feel that Iconovo is in a unique position in that we can develop more than the inhaler, we also develop the accompanying inhalation powder, for a complete inhalation product.
»With our current cash position, we have the financial freedom to pursue various development options that will benefit the business. It will be important to reach the market at the time of the first patent expiration for Ellipta, and, with such financial strength, we can have a focused development approach to deliver a complete inhalation product, meaning both the ICOpre inhaler and the first powder formulation, within that time frame« — Roger Lassing, VP Business Development at Iconovo.
How important is it for Iconovo to insert itself onto the US market? And what steps, if any, will Iconovo take in 2020 to better position itself on the global stage?
– The US market is an important segment of the global inhaler market due to its size and price levels, however, Iconovo is not dependent on entering the US market to be successful. In regard to the Ellipta opportunity, the US is very important as Ellipta has been particularly successful there. Within the pharmaceutical industry, projects tend to be global in nature, as usually a company’s goal is to maximize the commercial potential of its development investment. Thus, all innovation projects tend to target a global market already, and even if we potentially work with regional partners for some projects, we can still patch together a global coverage.
The year-end report mentions the aim to receive CE-marking of ICOcap by summer. What are the implications of such regulatory milestone?
– CE-marking ICOcap is a confirmation that ICOcap is a quality product, and in its first stage it means that ICOcap can be used in clinical trials. It is a quality assurance that many customers demand.
Another highlight of the report is Iconovo’s collaboration with CrystecPharma to develop innovative products in dry powder inhalers, which offer a complete solution to customers who need an optimal delivery of innovative substances to or via the lung. Do you expect similar partnerships in 2020?
– Our current aim is to further develop the collaboration with CrystecPharma by working together to offer innovative solutions to customers that have an API requiring a collaborative solution. Once you have a new collaboration, it is important to develop the partnership before jumping into the next one. We would first like to see what this collaboration can provide and get to know each other’s specialist areas. How it will develop depends on the needs and demands that we meet in our customer discussions.
The content of BioStock’s news and analyses is independent but the work of BioStock is to a certain degree financed by life science companies. The above article concerns a company from which BioStock has received financing.