Key Investment Highlights for Emmaus Life Sciences, Inc.
Emmaus Life Sciences, Inc. (“Emmaus” or “the Company”) is a commercial-stage biopharmaceutical company engaged in the development and commercialization of therapies, primarily for rare and orphan diseases, with an initial focus on sickle cell disease (SCD).
Emmaus’ lead commercial product is Endari® (L-glutamine oral powder), a safe and effective oral treatment indicated to reduce acute complications of SCD in adult and pediatric patients.
At the time of FDA approval in 2017, Endari® was the first ever FDA-approved treatment for SCD pediatric patients (5+ years old) and first new treatment of SCD in 20 years. Endari® has received Orphan Drug designation from the FDA and Orphan Medicinal designation from the European Commission.
Results of the Company’s Phase 3 trial demonstrated that the use of Endari® led to a significant reduction in the number of sickle cell crises, a delay in median time to sickle cell crises, and a reduction in hospitalizations and cumulative days in hospital.
The global SCD treatment market was estimated at $3.4 billion in 2020, and is expected to reach $8.5 billion by 2026, behind an increasing prevalence off SCD and new innovative treatments. Currently, only four therapeutic drugs have been approved by the FDA for the treatment of SCD: (1) hydroxyurea; (2) L-glutamine; (3) crizanlizumab; and (4) voxelotor.
Concerns about the safety and/or efficacy of some available therapeutic options are on-going. For example, hydroxyurea, approved by the FDA in 1998, contains a black-label warning highlighting the risk of severely low blood cell counts and cancer, the most stringent warning imposed by the FDA.
Voxelator’s mechanism of action, increasing hemoglobin’s oxygen affinity, presents some concerns of potential negative effects, as the bound oxygen cannot be off loaded when needed, resulting in a risk for reduced oxygen delivery in tissues with high oxygen requirements, such as the brain and the heart.
Endari®’s competitive position relies of the following key marketing advantages against other therapeutic options:
Approved for any complication of SCD (broad indication).
Approved for patients aged 5 and up.
Significantly lower cost versus new competitors.
No warnings, precautions, or drug interaction notices on label.
No requirement of blood testing before or during taking the medication.
Since FDA approval, yearly revenue has increased despite the effect from COVID-19 and the approval of competitive options. According to the Company, Emmaus has regained its growth position in the second half of 2022, behind the effective use of its in-house sales force and its newly launched direct-to-consumer programs, including an innovative full-service telehealth solution that provides online access to Endari®.
Through its distribution agreements, the Company has accumulated a network of over 600 specialty and health system pharmacies distributing Endari®, with prescriptions having been filled in 46 states, Puerto Rico, and Washington D.C.
Emmaus offers significant domestic and expanding global opportunities targeting the underserved SCD patient population and undeveloped therapeutic markets. Currently, Endari® is approved for use in the U.S. (2017), Israel (June 2020), United Arab Emirates (UAE) (March 2022), Qatar (November 2022), and Kuwait (December 2022).
The process for gaining approval has started in other Gulf Cooperation Council countries, including submission for approval in Saudi Arabia, Bahrain, and Oman. The Company is also working to obtain marketing approval in EU and non-EU countries, with an initial focus on Early Access programs currently underway or planned in the UK, France, and Turkey.
Emmaus has secured a source of prescription grade L glutamine (PGLG), overcoming one of the biggest barriers to entry for other companies intending to use L-glutamine for the treatment of SCD or other conditions due to its limited availability.
In December 2019, EJ Holdings, Inc., a Japanese joint venture between Emmaus (40% ownership) and Japan Industrial Partners, Inc. (60% ownership), purchased a pharmaceutical ingredient manufacturing facility in Ube, Japan for the manufacture of L-glutamine and other amino acids. EJ Holdings is in the process of retrofitting the plant to prepare it for a regulatory recertification, with test production runs expected to take place during 4Q 2023/1Q 2024, with regulatory approval expected to following shortly thereafter.
Emmaus is also involved in assessing L-glutamine as a treatment for diverticulosis, currently in a pilot trial, as well as pre-clinical programs for oncology and regenerative medicine with other compounds. The Company believes that its Endari® commercial activities and its developing pipeline of new products provide a sustainable business model resulting in multiple potential future sources or revenue.
Emmaus has a highly experienced management team with proven success in pharmaceutical research, development, and commercialization, led by CEO and principal inventor of Endari®, Dr. Yutaka Niihara (biography on page 10).
The Company has a sustainable business model and is developing pipeline of new products, which is expected to result in potentially multiple potential future sources or revenue.
As of its most recent quarter, the Company currently held $1.1 million in cash and cash equivalents.