By GREGORY ZELLER // “Innovative” is often associated with “new,” but when it comes to Long Island’s innovation economy, the region’s oldest biopharmaceutical company is leading the pack.
With a five-person staff and a market cap over $300 million, Lynbrook’s BioSpecifics Technologies Corp. is one lean, mean biotech machine – and the most profitable days for the firm, which launched in 1957 among the nation’s first batch of biotech startups, may lie ahead.
Consider the company’s recent performance on the Nasdaq. In the last three weeks alone, BioSpecifics Technologies shares have risen nearly 32 percent – a rocketing $10-plus ascent that propelled share prices past $47.50 as of Tuesday afternoon. And that after Newsday ranked the Lynbrook firm Long Island’s No. 1 performing public company of 2014.
The recent surge began on May 18 in Louisiana, at the annual meeting of the American Urological Society. That’s where Dublin, Ireland-based Endo International – a BioSpecifics Technologies partner and self-described “specialty pharmaceuticals company” – presented data on the efficacy of BioSpecifics medication Xiaflex as a treatment for Peyronie’s disease, a condition in which collagen causes the penis to curve during an erection, making sexual intercourse difficult or, in advanced cases, impossible.
Not only did Endo International report “improvements in penile curvature and bother related to Peyronie’s disease,” according to a BioSpecifics Technologies release, but “significant improvements” in Female Sexual Function Index scales including arousal, orgasm and satisfaction.
Investors, needless to say, were excited. And their passion for Xiaflex rose additionally June 1, when BioSpecifics Technologies President Thomas Wegman presented a corporate overview at the Jefferies 2015 Healthcare Conference, one of a series of annual investor conferences hosted by the influential New York City investment bankers.
With Xiaflex providing solid results and a lack of competition in the treatment of Peyronie’s disease, Wegman is pleased to note that BioSpecifics Technologies’ fairly underwhelming 1991 IPO was a long time ago.
“We raised just a tiny amount of money,” the president said. “Compared to the way companies go public today, it was rather modest.”
There’s nothing modest about BioSpecifics Technologies now. The company “beats out bigger companies with a lot more resources,” Wegman noted, and does it right here in its original Long Island home, where “we continue to utilize several research institutions that are very close to our home base.”
The company’s big gun is collagenase, an enzyme that breaks down collagen – the most abundant protein in mammals and the main ingredient of scar tissue, which the body produces in response to injury and an assortment of diseases. Xiaflex is an injectable collagenase.
While some of BioSpecifics Technologies’ original work came out of Columbia University – and the company struck up a developmental partnership in the 1980s with UCLA that continues today – BioSpecifics has achieved the bulk of its success via collaborations with local Long Island biotech stalwarts. Some of the first work on Xiaflex, Wegman noted, took place in Stony Brook University laboratories, making BioSpecifics both a shining example of Island-based invention and a major drum-beater for the Island’s innovation economy.
“The more we can promote our local research and scholastic opportunities, the better it is for us,” Wegman said.
More Island promotion appears to be on tap. In January, Endo International completed a $2.6 billion acquisition of Auxilium, a BioSpecifics Technologies partner with considerable marketing and sales resources. Endo purchased Auxilium, which helped BioSpecifics develop its collagenase product, “primarily for the Xiaflex asset,” Wegman noted, and that hefty price tag reflects the medication’s enormous commercial potential.
In addition to Peyronie’s disease, the injectable collagenase is showing “great potential” for at least 11 other conditions, including frozen shoulder, a painful and disabling disorder in which connective tissue in shoulder joints becomes inflamed and stiff. There’s also hope for keloids – painful, itchy external scars comprised mostly of collagen, affecting some 14 million Americans) – and uterine fibroids, benign tumors that form on uterine walls and generate some $34 billion in annual medical costs, according to Wegman.
All that potential means BioSpecifics Technologies may someday grow beyond its current miniscule staff, though the president noted “we pride ourselves on being very efficient and very shareholder-friendly.”
Whatever happens next with the BioSpecifics staff or its injectable collagenase, one thing is certain: It will happen on Long Island, especially if New York State continues to implement business-friendly incentives targeting the biotech sector.
“I’m hoping our state government can learn to operate in a more efficient manner that attracts more companies and keeps them here,” Wegman said. “We’re kind of solo on Long Island insofar as developing a biotech product that’s been commercialized, but there’s potential for a lot more.
“Gov. (Andrew) Cuomo has had some good ideas in terms of tax advantages, and we’re hoping they will really coalesce into something on Long Island,” he added. “It’s a far superior idea to building another shopping mall.”