505(b)(2) applications: “All Roads Lead to Cincinnati”

June 28, 2013

If necessity is said to be the mother of invention, then what might be the life spring of innovation? As Camargo Pharmaceutical Services celebrates its 10 year anniversary, the story of its rapid, sustained growth suggests that innovation in the bioscience industry is the offspring of hard work, experience, adaptability . . . and the courage to make a leap of faith.

When Ken Phelps and Ruth Stevens, Ph.D.,  founded Cincinnati-based Camargo in March of 2003, they couldn’t map the precise direction the company would take. “Ten years ago we envisioned having a smaller company, perhaps with mostly domestic, more established pharmaceutical companies as clients,” Phelps says. Phelps also planned that Camargo would provide a broad range of professional services for its pharmaceutical clients.

But in short order Phelps, Stevens and team gained the confidence to draw upon their hard work and prior experience at Duramed (now part of Israel-based Teva Pharmaceuticals). One of those seminal experiences included navigating the promising but challenging waters associated with the FDA’s application process for re-purposing already approved pharmaceuticals.

The so-called 505(b)(2) process offers many benefits by enabling companies to obtain FDA approval of certain new drug applications (NDAs) in a shorter period of time and with less expense.  Typically, a new drug application approved under the standard 505(b)(1) regulatory path will take as much as 15 years and a nine-figure investment to work its way through the system. However, drugs approved under 505(b)(2), which can rely in part on data from existing reference drugs, can be developed and achieve FDA approval in as little as 30 months with fewer required clinical trials and at a much lower cost. But the process is complex and requires an investment to utilize niche expertise so it typically had lent itself to larger pharma companies who hired assistance from skilled contract research organizations (CROs).

At Duramed, “We were doing a 505(b)(2) – in fact, it was one of the first ones ever completed. But we couldn’t find the suitable CRO support; companies and consultants were only targeting large companies,” said Phelps.

It was this first-hand experience with a successful project that would come to shape business strategy at the newly-formed Camargo. What also drove the business was a leap of faith to more aggressively devote resources to a business model that some considered risky due to a pending FDA ruling. An unfavorable ruling could invalidate most current and future 505(b)(2) applications – and jeopardized the fledgling Camargo’s survival.

But in October of 2003, the FDA validated the 505(2)(b) application process, and Camargo hasn’t looked back since. What started out as a business that completed one application every several weeks evolved to one that today might include several successful applications a month.

When asked if this was the company he imagined it would be Phelps said, “I’d be foolish to say I had that kind of vision.” Despite Phelps’ modesty about his ability to predict the nature and scale of the company’s success, he’s unabashedly proud of what has been accomplished at Camargo.

To illustrate, he tells the story of a Camargo client that recently gave Phelps a high compliment when he said, “If you’re looking for 505(b)(2) services and you talk to different people, all roads lead to Cincinnati.”

Congratulations to Camargo on its tenth anniversary. While creating a roadmap that drives innovation and value from the storehouse of investments in pharmaceutical research and development, Camargo is also continually helping to design a roadmap for success for Bio in Ohio.