Aratana prepares for shift from R&D house to commercial operation

Dogs
Aratana is launching two new drugs for dogs and could have a third this year.

Aratana Therapeutics ($PETX) is facing a challenge that many of its rivals in the animal health industry are likely to envy: two new products already approved by the FDA this year and one more likely to get the nod by the end of the summer. Suddenly the Kansas-based company is facing a tough shift, from pure R&D house to a full commercial operation with a suite of products to sell.

In late June, Aratana took a big step towards making that transformation by appointing its first chief operating officer, Brent Standridge, a 28-year veteran of Wyeth’s Fort Dodge Animal Health. Most recently, Standridge served as a consultant for the veterinary drug maker Putney, which was acquired by Dechra Pharmaceuticals for $200 million in March.

"Through Brent's experience in managing a large animal health business of $500 million and a staff of more than 300, we expect he will lead us in successfully launching and selling our innovative therapeutics," said Aratana CEO Steven St. Peter, referring to Standridge’s Wyeth years, in a press release.

Aratana will have plenty of help selling its first newly approved drug, Galliprant (grapiprant) for dogs with osteoarthritis, thanks to a co-promotion deal the company struck in April with Eli Lilly’s Elanco. In return for $45 million up front and the promise of subsequent payments, Aratana agreed to co-promote the product in the U.S. with Lilly but to hand over the overseas rights. In February, Aratana filed for approval of Galliprant in Europe.

But Aratana is retaining all commercial rights to Entyce (capromorelin), its appetite stimulator for dogs, which was approved in May. And later this year, the company expects to launch Nocita (bupivacaine), a long-acting pain reliever for dogs undergoing cranial cruciate ligament procedures. One day after Standridge’s appointment to the COO post, Aratana announced it had completed its Nocita submission to the FDA and was expecting a decision by August 28.

The financial impact of Aratana’s shift to a commercial entity has been a bit more of a burden than investors initially expected. In May, the company announced that its net loss in the first quarter doubled to $18.1 million, or 52 cents a share, which was a dime higher than the average forecast.

But in a conference call with analysts after the release, St. Peter was upbeat, not only about teaming up with Elanco to market Galliprant, but also about the company’s prospects beyond that launch. In addition to the two subsequent product introductions expected this year, he said, the Elanco partnership is freeing up resources for Aratana to devote to late-stage molecules in its pipeline. They include AT-016 for dogs with osteoarthritis and AT-018 to treat canine atopic dermatitis, he said.

- here’s the Nocita release
- get more on Standridge here

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