Biotech and Money [B&M]: First of all, it’s almost a year to the day of your listing on NASDAQ. To add context to the interview, are you able to briefly recap on the details and reason behind the IPO that took place back in June 2013?

Hans Schikan [HS]: At the time we had a partnership in place with GlaxoSmithKline (GSK) since October 2009. That partnership allowed us to make use of GSK’s resources to develop our lead asset in Duchenne Muscular Dystrophy (DMD). GSK had an option on other compounds in the portfolio as well, whilst we still retained substantial rights to ourselves for other compounds.

At that time we had developed different compounds for different mutations of DMD, for different sub populations of patients. The plan was to sufficiently finance the company to be in a position to accelerate these compounds, which we eventually could develop and commercialise ourselves.

So that was the main rationale behind the IPO. Moreover, it was a logical step in the development of the company. We’d already carried out 3 previous private financing rounds, the last one in January 2012 when New Enterprise Associates, one of the largest US biotech investors, came on board.

So on the back of positive clinical data presented by GSK presented in April 2013 we conducted the IPO. In short, we did the IPO to create the financial resources for our compounds and to prepare for a broad pipeline of Duchenne compounds.

B&M: The successful IPO was a rare win for the European biotech community at the time. You did it through NASDAQ, what was the reasoning behind that, given there hadn’t been such a cross-Atlantic leap for a biotech in about 10 years.

HS: I still remember very well when our CFO, Berndt Modig, mentioned the idea of an IPO in the US, and before being convinced, my own initial reaction was the ‘Why the US?’ Why not just do it in our home market where we have a lot of recognition, many people know us here, we are seen by many as one of ‘the pearls of Dutch biotech’, so why not just carry it out in Amsterdam or London, Brussels or Paris? There were many possibilities here.

Our supervisory board had exactly the same response and asked that we came back to them with some examples, some precedence of other EU companies that had done this successfully earlier. We had to go back over 10 years to provide some backing to our argument, but at the time, it proved to be an excellent choice. It felt like a pioneering step to list on NASDAQ as a foreign private issuer in Life Sciences. If you looked at the financial markets in the US at that time, there was more depth and width than in most European markets.

That’s not to say it was easy. There’s a lot of competition out there, and you really have to make sure that your story and your message resonates. The investment community in the US is extremely sophisticated and well educated so it requires a lot of preparations to make sure that you get access out there. It’s not like deciding today that next month you want to go public on NASDAQ. That I think would be grounds for failure.

B&M: You raised $90m. If you had to distil the elements of the IPO, what would you say were the things that made the listing so successful?

HS: We originally were planning to issue 6 million shares at a range of $11 to $13 dollars per share, but if you include the greenshoe then eventually we raised $90m prior to the costs of the IPO.As a result of these interactions and the fact that we had already been seeing quite a few private investors in private rounds, many people already knew the story. Moreover, the awareness of DMD was already high in the US because of peer companies, and it allowed us to have high-level interactions with the investment community.

Secondly, the science behind the company and the team behind the company resonated as well. Of course I’m biased in that respect, but we have a great team with experience in the rare disease field. With many of our US investors, we’d already been visiting them a number of times prior to the IPO, even at a time when we were still contemplating further private rounds. This was also at a time when New Enterprise Associates came on board. The JOBS act was also very useful in this respect, allowing for “testing the water” meetings prior to the IPO.

Finally, we were helped by the fact that the day before the actual pricing would occur GSK received Breakthrough Therapy designation from the FDA for our lead compound that helped as well. By that time we were already substantially oversubscribed in the book, but it did help at the very last moment to bring us to be almost ten times oversubscribed.

Overall I think the most important aspect really is preparation however.

B&M: It’s fair to say the last 12 months since the IPO have had their fair share of ups and downs. So lets talk a little more about these past 12 months. Do you want to start by talking a little about your lead DMD candidate, Drisapersen, and how that’s influenced the last 12 months.

HS: A biotech roller coaster is the best way that I would describe the last 12 months. We had a great IPO, then on the 20^th of September we announced the results of the phase III trial on Drisapersen which was totally unexpected and not anticipated given the promising results from earlier studies. Many patient organisations refer to that date as Black Friday.

From that moment onwards, given the unexpected results in this trial, together with GSK we initiated a process to try to analyse the data and compare them with the previous study results On the 13^th of January we announced that we had regained the rights back from GSK, the reason being that both GSK and Prosensa felt that Prosensa would be in a good position to bring this treatment to patients. Three days later, on the 16^th of January at our corporate update at the JP Morgan Healthcare Conference we could share our shared our view on the data, as we had been analysing together with GSK for the 3½ months before that.

At that moment, the IND was still in the name of GSK and a meeting was planned with the FDA on the 24^th of January. Together with GSK we met the FDA, and had the IND transferred to us on the 18^th of February. In a follow up meeting on the 14^th of May, without GSK, we discussed the possibility of an accelerated approval that then led to a written guidance by the FDA on the 2^nd of June, which we made public the next day.

Based on this guidance there is a possibility for Prosensa to file Drisapersen on the basis of existing data in an accelerated approval process. By no means are we there yet because we are now in very busy route to prepare that file, to work on the more than 350,000 clinical data files, which were transferred from GSK. But GSK has been very helpful and now Prosensa is geared up for this potential accelerated approval.

Our intent is to file in the United States later this year and we also have the intent to file in Europe where we are in discussion with the European Medicines Agency on a similar process.

So I must say, it has been a roller coaster ride, up and down and up again, and now we are trying to execute on that promise to the patient community that we want to file by the end of the year.

B&M: In September, the candidate failed to meet its primary endpoint in Phase III, but am I right in thinking that the trial itself failed the drug rather than the drug itself failing the trial?

HS: The trial by GSK was conducted in 44 sites across 19 countries in a total of 186 patients, which is a large trial for a rare disease. However, we know little about the potentially different standards of care in these countries and how that may have impacted the results of the trial. Moreover, we saw in our Phase III that older boys were included, many of whom were more advanced in their disease, as illustrated by worse baseline characteristics than in previous studies. In our data assessment, a pre-specified analysis was done on age, in boys 7 years or younger, who were generally less advanced in their disease. These boys had a doubling of the six-minute walk distance between placebo and Drisapersen as an outcome. In the overall phase III study Drisapersen performed only about 10 metres better in the walk test over 48 weeks. For clinical relevance we were aiming for 30 metres, but in the meantime a publication has come out which shows that perhaps 20 metres already could be clinically meaningful. So the 21 metres we saw in the group of 7 years and younger was encouraging. But then we performed another analysis later on, a post-hoc analysis, where we looked at those older than 7 with a more defined baseline six minute walk distance.

Based on natural history studies we now know that age and baseline six-minute walk distance are important parameters to predict loss of ambulation in boys with DMD. Interestingly, we saw that boys above 7 who had a higher base line in this test, so those who were ‘healthier or less progressed in the disease, with a baseline walk test between 300 and 450 metres, showed a difference between placebo and Drisapersen of some 25 metres. We also discovered that 1 out of every 4 boys in the phase III trial was older than 7 with a baseline walk test of less than 300 metres and that’s where you see the most variability.

Our challenge will be to convince the regulators. The guidance we received from the FDA on June 2 is available on our website. We felt important to be as transparent as possible with the entire community, thus we filed the full letter with the SEC. Read More…

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