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Monday, March 21, 2005

Nano-based Drug Delivery Devices: A Larger Market than $1.7 Billion

Earlier today, an independent consulting firm announced that it had just issued a new report stating that the "nano-enabled drug delivery market was expected to pass $1.7 billion in 2009." At an asking price of $500, I won't be paying for the report and would encourage my readers to think long and hard before popping down so much money for the report.

From my perspective, the figure of $1.7 billion is too low and it leads me to question the methodology the consultants used in putting together their report. I cite the following evidence as why I believe the figure is too low:

1. Earlier this year, American Pharmaceutical Partners received FDA approval for its new nano-based Abraxane. The market for this breast-cancer treating product alone is expected to be between $125-$250 million in 2006.

2. Elan Corp's nanocrystal technology is already being used by Johnson & Johnson to treat Schizophrenia, and the company now has a partnership with Roche which could lead to additional revenues.

3. Starpharma's VivaGel--a dendrimer-based topical microbicide being tested for HIV--is in Phase II FDA trials and I believe it has a good chance of being fast-tracked. Longer term, the technology could also potentially be used to treat Herpes and Chlamydia.

4. pSivida's BrachySil technology--used to treat liver cancer--is also in late stage FDA trials. The company is working with at least two other "Top Five" global pharma companies and has plans to expand its technology platform to the treatment of pancreatic, ovarian and bladder cancer.

5. SkyePharma is capable of reformulating a number of off-patent drugs using its IDD-D platform--much as it has already done with Propofol.

6. Flamel, although it's stock has taken a plummeling lately, is still working on its Medusa technology which could lead to the more effective delivery of insulin. If it is successful, it could also lead to signficant sales.

7. Pfizer, Bristol-Myers Squibb, Merck and a host of other major pharmaceutical firms are also working on various nano-based delivery systems--many of which are likely to lead to real products before 2009.

I would also argue that the consultants projections that the nano-based delivery market will only grow to $4.8 billion by 2012 underestimates the potential of a number of very promising nanotech start-ups such as NanoBio and NanoSpectra (among others)--whom are likely to be starting their own FDA trials in the next year or so.

Jack Uldrich

Related Links:
Starpharma "Nano" star on the rise?
Elan Good News for Nanotech Investors?
pSivida: Down Under Comapny has Big Upside Potential