Intarcia submits diabetes NDA, triggering $100M payment

Intarcia has filed for approval of its matchstick-sized, long-lasting GLP-1 delivery implant.

Intarcia Therapeutics has filed for FDA approval of its osmotic mini-pump Type 2 diabetes treatment. The submission triggered a $100 million payment, giving Intarcia some of the cash it will need to take on Big Pharma in the fiercely competitive diabetes sector should it win approval.

Boston-based Intarcia has built its regulatory submission on data from four Phase III trials it ran over the past few years. The trials of Intarcia’s matchstick-sized, long-lasting GLP-1 delivery implant included a study pitting the device against Merck’s Januvia. Over the year-long study, Intarcia’s ITCA 650 bested Januvia at cutting blood sugar and body weight. And with a 4,000-patient cardiovascular safety study also coming good in May, Intarcia thinks it has the data to win over FDA.

The $100 million Intarcia received for submitting the NDA is the final tranche of a deal Intarcia put together last year. That deal saw investors commit $300 million in return for 2% royalties on sales of ITCA 650.

With the $100 million landing in Intarcia’s bank account between an initial, $215 million close of an equity round and a planned larger second close, the company is hoovering up money in anticipation of the commercial introduction of ITCA 650.

Faced with the need to run large clinical trial programs and then compete with Big Pharma sales forces, small companies with diabetes programs typically partner up before phase 3 trials. Intarcia took a different tack, opting instead to raise upward of $1 billion from private investors to get ITCA 650 to an NDA without becoming beholden to either a partner or public financiers.

Intarcia’s hunger for cash has made it a perennial IPO candidate, but the company is sticking with the private life for now. CEO Kurt Graves set out the reasons for staying private in an open letter.

“It allows us to focus completely on execution and fully commit to the critical decisions and actions we must make to drive our key strategies and high impact initiatives for growth. By remaining private and “going it alone” through the first year of launch, we can accrue powerful benefits,” he wrote. “This includes our level of focus and prioritization on launch, our ability to stay gyroscopically on course and flexible, and our ability to maintain urgency in making timely decisions and taking reasonable risks. It also helps us sustain our lack of bureaucracy and avoid external distractions that don’t add value.”

Graves thinks the milestones and equity financing being lined up by Intarcia will see the company through the first year ITCA 650 is on the market.