Genzyme, the biotechnology company already reeling from problems manufacturing its drugs for rare diseases, will soon have a formidable new competitor — the pharmaceutical giant Pfizer.
Pfizer said Tuesday morning that it had licensed the worldwide rights to a treatment for Gaucher disease, a rare genetic disorder, from Protalix, an Israeli biotechnology company. That will put Pfizer into competition with Cerezyme, Genzyme’s biggest-selling product.
The deal marks Pfizer’s entry into the business of selling ultra-expensive drugs for ultra-rare diseases, a business that has become increasingly attractive to big pharmaceutical companies.
Only about 5,700 people in the world are being treated with Genzyme’s Cerezyme. But since the drug costs about $200,000 a patient per year, even a small patient population can support sales exceeding $1 billion a year.
Pfizer will pay Protalix $60 million initially and up to $55 million later. The companies will split expenses to market the drug and revenue on a 60-40 basis, with Pfizer having the larger share.
Protalix is close to filing its application for federal approval of the drug. The product, called taliglucerase alfa, could reach the market next year.
Big pharmaceutical companies once tended to disregard rare diseases, preferring to develop blockbusters for common ailments like diabetes and high cholesterol. But with sales growth slowing and older blockbusters losing patent protection, the companies have become more willing, even eager, to sell specialized drugs.
“This agreement supports our goal to meet the needs of many patient populations, including those affected by rare diseases,” David Simmons, president of Pfizer’s established products business unit, said in a statement.
In October, GlaxoSmithKline announced a deal with Prosensa, a Dutch company, to develop drugs for Duchenne muscular dystrophy, a rare disease. And in June, Novartis won approval from the Food and Drug Administration to sell its drug Ilaris as a treatment for cryopyrin-associated periodic syndrome. Only about 300 Americans suffer from that syndrome, an inflammatory condition caused by a gene mutation.
As a small company marketing its first product, Protalix was not expected to provide much competition to Genzyme by itself. But having Pfizer in its corner should help.
The new competition comes as Genzyme is struggling to recover from viral contamination that caused it to halt production at its factory in Boston in June. That led to severe shortages of Cerezyme and of Fabrazyme, a drug for Fabry disease, another rare condition. Many patients had to forgo some or all of their treatments.
On Monday, Genzyme executives told Gaucher patients on a conference call that that shipments of Cerezyme have resumed but that initially supplies would be restricted to patients most in need. Shipments for other patients will resume Dec. 28.
The shortfall left Genzyme vulnerable, not only from Protalix but from Shire, a British drug company, which has applied to the F.D.A. for approval of a drug for Gaucher disease. Because of the shortage, the F.D.A. allowed some patients to use the Shire and Protalix drugs even though they have not been approved.
Gaucher disease is an enzyme deficiency that can cause enlarged liver and spleen, anemia, frequent bleeding and bone weakness.
All three drugs consist of the enzyme that people with Gaucher disease are missing. Genzyme makes the enzyme in genetically engineered hamster ovary cells, the standard production process for the biotechnology industry. Shire makes it in engineered human cells.
Protalix’s drug, in a departure from the norm, is made in genetically engineered carrot cells. And it grows the carrot cells in plastic bags, rather than the stainless steel vessels that most biotechnology companies use.
Protalix says its method sharply lowers production costs. It has hinted that the price of taliglucerase would be 25 to 35 percent less than that of Cerezyme, according to a recent note by Yaron Werber, biotechnology analyst at Citigroup.
Presumably, however, Pfizer will now have input into setting the price. And even at 35 percent off, taliglucerase would still cost well over $100,000 a year.
Some doctors and analysts have been concerned that patients could have immune reactions after receiving a human enzyme made in plant cells. The results of Protalix’s most recent clinical trial assuaged some of those concerns, but they are still expected to hinder sales of the drug.