According to a 2012 Fraser Institute report, 30 of the 33 new oncology drugs that came on the market between 2003 and 2011 were approved in the United States. Only 24 were approved in Canada.
In some cases, large pharmaceutical companies don't feel the Canadian market is big enough to warrant going through the process of getting Health Canada's approval to market a drug here after it has received Food and Drug Administration approval in the U.S.
Superna Life Sciences – founded by a small group of former employees at the downsized QLT Inc. (Nasdaq:QLTI) – is capitalizing on that gap by bringing FDA-approved drugs into Canada. It specializes in medication for cancer treatment side effects (see sidebar).
"We look for niche therapeutics for cancer treatments with a high unmet need that are not available in Canada," said Superna CEO Tom D'Orazio, former senior director of global marketing for QLT. "What we try to do is license those and bring them to Canada."
The team certainly has the right pedigree for such a venture. In addition to QLT, D'Orazio has worked for large pharmaceutical companies and smaller biotechs, including Protox Therapeutics Inc., which last year changed its name to Sophiris Bio Inc. (TSX:SHS) and moved to California.
Superna co-founder Bruce Clarke is also a former QLT employee. And former QLT CEO Bob Butchofsky – who went on to found Mati Therapeutics in Texas – was an early investor and now chairs Superna's board of directors.
LifeSciencesBC president Don Enns said Superna's approach is similar to the one Aspreva Pharmaceuticals used – finding secondary uses for already approved drugs. Aspreva was eventually acquired for close to $1 billion.
"In this case with Superna, it's not that much different, in the sense that they're looking at applications where there's already approved product in other jurisdictions and seeing about repurposing it in the Canadian market," Enns said. "The reality is that you will generally not find many of the large pharmas that would find this too attractive simply because it doesn't offer the scale that they would typically enjoy."
D'Orazio said he realized that there was an unfilled niche market for drugs that are already approved elsewhere but not in Canada.
"It's a tough business model to try to raise hundreds of millions of dollars over a decade," he said. "It seemed to me, why should you go through all that difficulty and effort to develop something to help patients when there's plenty of things right now that you could get to market much more quickly with much less risk and capital investment?
"I always thought it's a shame because these products will eventually end up in Canada, but sometimes it's years after they've been approved [in the U.S. or Europe]. There are patients who could be using these things, and there's a business as well."
It's not a slam-dunk that a drug approved by the FDA will get Health Canada approval. However, it means most of the heavy lifting is already done, since the primary cost of commercializing a drug is clinical trials.
"You're talking over $1 million just to get it out of the door," said D'Orazio. "And that's without having to do any clinical trials. It's still costly, at least for a company like us."
D'Orazio estimates sales of its drug Quadramet in Canada could generate $5 million a year. That's peanuts for a big biotech or pharmaceutical company, but for a five-person company like Superna, it would be more than enough to generate a profit and fund new pipeline candidates.
Superna has identified 24 cancer-related "niche" drugs that it believes could be approved for sale in Canada.
