Lypanosys’ Eczema Treatment, the new Breakthrough in Dermatology

The prevalence of Eczema worldwide is high and growing.   In Australia alone GPs treat 1.8 million cases of eczema per year.  In the US, approximately 10% or 35 million people suffer from the disease at some stage in their lives and many of these suffer on an ongoing basis. With no effective products available for the convenient, safe and chronic treatment of Eczema this is one of the largest unmet market opportunities in dermatology today.

Lypanosys, a New Zealand drug development company, has demonstrated it has a breakthrough that would disrupt this growing and global market segment.  Andrew Turnbull, Managing Director of Lypanosys, outlines the discovery, “Our lead compound, LYP-010 is a naturally derived product that is being developed as a safe, oral product for the treatment of Eczema.  The current main treatments used by the medical profession are topical steroids and topical calcineurin inhibitors.  These have unpleasant side effects or safety concerns, especially in the long term treatment of sufferers. They are also topical which makes them messy and awkward to apply resulting in poor compliance.”

Convenient, safe and chronic treatment of Eczema

Topical treatments are not regarded as an optimal solution.  The diligence required to apply creams to all affected areas twice a day is unrealistic for many patients and parents of children who suffer from eczema find this very difficult to manage.  “The practicalities of this contribute to the high levels of non-compliance for topical treatments which substantially reduce the effectiveness.  With LYP-010, the treatment is a simple to take oral product and is formulated as a cherry flavoured suspension for children or a capsule for adults.” said Mr Turnbull.

Convenience affects compliance which drives effectiveness but the primary issue facing users is safety.  “Strong steroids can only be used in short bursts to avoid the effects of long term use.  For children, who represent a major segment of the market, there are particular concerns about the safety of these treatments.”

Eczema is an immune system disorder and not just a dermatological problem. Topical treatments only treat the symptoms at the specific site where the ointment or cream is applied but they don’t deal with the underlying immune system issue.  “LYP-010 has the ideal product profile treating the disease systemically with a simple, convenient, oral delivery. Also because it is naturally derived with a history of use as a dietary supplement its safety profile is ideal and much, much better than newer immune system treatments for eczema such as calcineurin inhibitors. There are significant concerns about possible links to cancer with these.”  To this effect, LYP-010 represents a novel product that will be very well received in this market segment.

Capitalising on the market opportunity for Lypanosys

In the US alone, the sales potential for the product is conservatively estimated at more than US$700m per year.  To bring this breakthrough product to market Lypanosys plans to build on the results and body of work from its Phase 2a and earlier studies. “We have completed the preparatory work and clinical trials required by the US FDA and have some good results from a small Phase 2a pilot study.  Now is the time to fund a definitive Phase 2b study to further validate the product’s safety and to prove its effectiveness.  This study is sized for statistically significant efficacy using the results and information from all the other work and is the culmination of more than 6 years of preparatory effort and significant levels of funding. We are very confident that this study will be successful and if so it is likely to lead to the licensing or sale of the rights to this product globally.”

Because of all the preparatory work already completed the safety, efficacy and regulatory risks are largely mitigated. The company is confident that there is a good opportunity for a very good return for investors in a short timeframe. “The investment proposition has been well received with sophisticated investors on the Wholesale Investor platform. We expect to be able to deliver the results from the Phase 2b study within 18 months of funding and expect a licensing deal with a major Pharma or Dermatology company within 2 years of funding.”

With Venture and Pharma Industry veterans backing the company, there is a realistic prospect that Lypanosys can be strong candidate for an exit event supported by multiple market precedents. “Comparable deals in Dermatology support a license deal with a total value well in excess of $200m.  But for us it is also very rewarding to be working on a product that is likely to have such a significant and positive impact on eczema sufferers worldwide.”