Just 11 people work inside a 150-sq.m. rented prefab building in the “Hi-Tech Village” on the edge of the Hebrew University of Jerusalem’s Givat Ram campus. The Oramed Pharmaceuticals company, which until a few weeks ago occupied an even-smaller space a few steps away, buys only secondhand furniture – not because CEO Nadav Kidron and chief scientific officer Miriam Kidron – his biochemist mother – are cheapskates. They are just modest, and Oramed is a public company with stockholders and investors behind it.

But the Kidrons’ eight-year-old biotech firm is currently the world’s best hope for an oral insulin capsule, which could improve the lives and health of 400 million diabetics – both type 2 and type 1 – around the world.

Although the Jerusalem company has for years been issuing press releases about its progress in producing such a revolutionary capsule and the product is estimated at being around five years away – if all goes well, the Kidrons predict that 2014 will be the most important year in its history.

“We asked the US Food and Drug Administration (FDA ) for permission to conduct phase 2 clinical trials.

They said we first needed a safety study, so we did it on 30 people in Orange County, California, at the Integrium company. We are waiting for results. If they are proven successful, as we expect, we can go into phase 2-b trials,” said the chief scientific officer in an interview at the company. “We can always make changes if necessary.”

While it has fewer than a dozen employees including the Kidrons, the company boasts a very prestigious scientific advisory board that includes Nobel Prize laureate Prof.

Avram Hershko; former Pfizer pharmaceuticals executive Dr. Michael Berelowitz; former Bausch & Lomb CEO Gerald Ostrov; and Mount Sinai School of Medicine diabetes expert Prof. Derek LeRoith.

Injected insulin was first produced in 1921 by Canadian surgeon Dr.

Frederick Banting and his assistant, medical student Charles Best, and it saved victims of type 1 diabetes, an autoimmune condition in which the islands of Langerhans in the pancreas were destroyed by the body, and that was inevitably fatal.

From that early event, scientists searched for an oral insulin pill to make the self-injections several times a day unnecessary.

Although there are oral pills to treat type 2 diabetes, which usually results from lack of physical activity, overweight and poor diet, and sometimes as a result of emotional stress, they gradually lose their efficacy.

But there were seemingly insurmountable problems. The insulin couldn’t be given orally, because enzymes in the digestive system destroy the protein. In addition, the molecule is too large to pass into the intestinal wall.

During the 27 years that Miriam worked at a lab at Hadassah University Medical Center’s diabetes unit, she devoted her time, with its director Prof. Hanoch Bar-On, to an oral delivery system for insulin. For years, some fellow researchers laughed at them for their idea. But eventually, she received recognition as the recipient of the Bern Schlanger Award for her work on diabetes research, a visiting professor at the University of Toronto’s medical school and a member of the American, European and Israeli Diabetes Associations.

Bar-On established Oramed together with Kidron, and served as its director until his premature death. They achieved a medical breakthrough in 2005 that laid the foundation for the founding of the company, of which Hadassah remains a part owner. At first, they experimented on rodents, cats and then pigs.

“The best animal model is the pig, but when we offered proof that our delivery system worked on healthy people, we no longer had to try it on animals. Using an animal model is not enough to show it works in humans,” Miriam said. “We introduced a substance that delays action of proteolytic activity and an enhancer that causes the molecule to go through the intestinal wall,” she recalls.

Nobody in their family suffered from diabetes of either type. “I got interested in it because I worked with Hanoch. But already in 2006, when we founded the company, we knew what a plague diabetes would be, as the obesity epidemic had long been underway,” said Miriam.

“Since then, our capsule has gotten a lot of attention at medical conferences.

We have published numerous articles in prominent medical journals, and we were very visible at the American Diabetes Association’s meetings.”

The Oramed team experimented with their oral delivery system for type 1 and type 2 diabetes of ordinary insulin on rats and then dogs, but the experiments were for some reason not reproducible. “But then we added an oil, and suddenly, the good results could be repeated,” Miriam continued. “It’s the same white capsule for both types, but different indication. The type 2 pill would be given once daily before going to sleep and vastly improve insulin-blood sugar balance,” Miriam said, while for insulin-dependent (type 1) diabetes, patients would not stop injecting themselves but they would need fewer shots. For this, the capsule would be taken before meals three times a day.

DIABETOLO GISTS RECOMMEND that many type 2 patients start giving themselves injectable insulin at an early stage in the condition to avoid complications in various parts of their bodies, but patients want to avoid insulin pens so as not to change their lifestyles and the twinges of pain several times a day, so they are reluctant to replace metformin and other glucose-controlling pills. Injecting insulin can also result in hypoglycemia (low blood sugar), which can cause confusion and more serious complications.

With an oral insulin capsule, patients would be able to enjoy the best of both words by getting insulin at an earlier stage, Miriam explained.

About 10 percent of the world’s 400 million diabetics have the type 1 type. With an insulin capsule, both would enjoy better sugar control.

Meanwhile, Nadav received a degree in law and a master’s degree in business administration and was instrumental in the founding of Oramed and running it since then.

Novonordisk, the huge international diabetes-care company based in Denmark that first commercialized injectable insulin, today has a market value of some $75 billion compared to Oramed’s $50 million.

NovoNordisk has been working on its own oral insulin capsule – even though, 15 years ago, its officials said there would “never be an oral insulin pill” – and holds patents on its own technology.

But the Kidrons say Oramed is at the most advanced stage and has its own delivery-system patents in Israel, Europe, Japan, New Zealand and elsewhere. “We hope to have patent protection in the US in 2014. We are like David and Goliath,” Miriam suggested with a smile. “NovoNordisk is only completing phase 1 studies. The two companies also work independently and are not working cooperatively.”

Oramed’s staff seems to be exceedingly small. “We outsource other jobs such for medical writing, dealing with regulatory authorities and consultancy,” Nadav explained. “We have the same philosophy about diabetes as Pfizer had about cholesterol. It developed its Lipitor pill to bring down blood cholesterol and thus significantly reduce the risk of heart disease.

With oral insulin, we will do the same with diabetes.

“People who will take our capsule will be less likely to need insulin injections. The savings are huge, as more than half a trillion dollars a year are spent around the world on diabetes care,” Miriam added.

But producing a new delivery system, even of a protein that has been known for almost a century, is extremely costly, takes m a n y years and g o e s t h r o u g h many stages.

“In our Hadassah lab, we did dose- re - s p o n s e pharmaco-kinetics. Companies want to see insulin in the blood. But healthy people have their own insulin in the blood. So we managed to show dose response in a small group of people with uncontrolled type 1 diabetes. It was a small group, but statistically significant,” said Miriam.

“Our oral insulin is absorbed and can be seen in the blood, so their blood sugar level declined a lot.

They continued giving themselves injections, but the capsule improved their situation.”

‘WE KNOW the capsule, simply called ORA-0801, works on humans,” said Nadav. “Once we get approval for phase 2b, we will do more clinical trials. We don’t know exactly what will demanded for multi-center phase 3 trials. These cannot be performed in one country.

But at the end of those, we will seek out a strategic partner.”

Oramed has investors from New York, including the Sabby Healthcare Fund and The AWM investment company. The chief scientist’s office of the Economy Ministry invested NIS 6.5m. in 2009 as well.

Last February, Oramed was first listed on NA SDA Q. The stock value has almost doubled to $13 per share in that time.

“Of around $40m. invested in us, we have more than $20m. in the bank. We spent the money on pre-clinical and clincial trials, production, regulation work and patents,” said the lawyer. “The CEO of a large American pharmaceutical company told me, ‘You managed to do everything so far at only 10% the amount it would cost a US company.’ The huge international pharmaceutical company Pfizer abandoned its nasal-spray insulin delivery system in 2007 and lost a great deal of money.”

If (or when) the capsule wins final FDA approval, the company can go ahead with production. “It isn’t likely that a local company has the ability to manufacture it. We would be very happy to have it done in Israel, but the development is Israeli,” the Kidrons said. At present, a company named SwissCaps, in Switzerland, and another company based in New Jersey manufactures the capsules used on human trials.

While Oramed has focused its work on diabetes and insulin, it has not put all its eggs in a single basket.

It has also developed an oral GLP1 analog, oral exenetide. At present, the hormonal drug for diabetes, known commercially as Byetta, must be given by injection, but among the frequent side effects is nausea. But it’s beneficial because diabetics who inject eat less and lose weight. With the oral insulin pill, oral exenetide could work synergistically.

The oral preparation could minimize such a side effect and make exenitide much more attractive to patients. A third product being developed is a combined oral insulin and oral exenatide capsule.

Oramed has a third product in the pipeline that combines oral insulin and oral exenatide. So far, only animal studies and not human trials have been performed, but the results have been promising, Miriam said.

Modest through it all, the Kidrons make great efforts not to make promises.

“We haven’t even considered a commercial name yet for our insulin capsule. Five years away for production is realistic. We learned that we can’t exaggerate or make promises,” said Miriam.

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