Decision is a setback for former partner Advanced MagneticsOnly months after acquiring ultrasound contrast firm Andaris, U.K. drug delivery company Quadrant Healthcare has decided to withdraw from medical imaging and divest the ultrasound contrast
Decision is a setback for former partner Advanced Magnetics
Only months after acquiring ultrasound contrast firm Andaris, U.K. drug delivery company Quadrant Healthcare has decided to withdraw from medical imaging and divest the ultrasound contrast agent technology that Andaris was seeking to commercialize. The move has already affected former Andaris distribution partner Advanced Magnetics, which had rights to distribute one of the company's agents.
Quadrant's decision to exit imaging came after the company bought Andaris in November for about $21 million. The deal prompted Quadrant to begin a strategic review of its new business portfolio, according to Sue Harris, Quadrant's commercial director.
The Nottingham, U.K.-based company intends to focus on the drug-delivery side of Andaris' assets. It believes that Andaris' imaging business would be a more appropriate fit for a company that focuses on medical imaging.
"There was a need to focus the portfolio of the combined, enlarged business," Harris said.
Quadrant has moved from its former Cambridge, U.K., headquarters into Andaris' Nottingham facilities and has begun seeking divestiture partners, Harris said.
When Quadrant purchased Andaris, it gained ultrasound contrast technology that Andaris had been developing for extended myocardial perfusion imaging. Andaris was established in 1994 following a management-led buyout of British pharmaceutical developer Delta Biotechnology's microencapsulation technology (SCAN 2/5/97).
This technology produces spherical microbubbles that are detected by ultrasound scanners. The main products in the Andaris pipeline are Quantison and Myomap, which are in phase II and preclinical trials, respectively.
A main selling point of the agents is their long duration, with Quantison offering 10 to 30 minutes of contrast-enhanced imaging. Andaris received a patent in May of last year for the microcapsule technology used in Quantison and Myomap, as well as for Synthocytes, a platelet substitutive.
Quadrant's purchase of Andaris and its divestiture plans are already having repercussions in the contrast industry. The move affects Advanced Magnetics, which in March 1998 signed a deal with Andaris for rights to distribute Quantison in the U.S., Canada, and Mexico (SCAN 3/18/98). Quadrant and Advanced Magnetics mutually agreed to end the deal.
Advanced Magnetics of Cambridge, MA, originally pursued the deal with Andaris in an effort to diversify its product offerings due to a sluggish market for its two MR imaging agents, Feridex I.V. and GastroMark. Feridex is a liver cancer agent and GastroMark is an abdominal agent, both cleared by the Food and Drug Administration in 1996 (SCAN 9/11/96 and 12/18/96). The company hoped that expanding its scope into ultrasound agents would bolster its lagging sales.
But with the Andaris agreement terminated and its MR contrast products still producing only modest results, Advanced Magnetics reported lower revenues for its first fiscal quarter of 1999 (end-December). The company posted income for the quarter of $915,000, compared with revenues of $1.4 million for the previous year's corresponding period. Net losses were $2.6 million, compared with a net loss of $1.7 million the year before.
Despite the lower results, Advanced Magnetics is continuing its MR contrast technology R&D program. Its new drug application for Combidex, an MR contrast agent for use in diagnosing lymph node and liver disease, is on track for a regulatory filing in the second half of 1999, the company said.