41 Epidermolysis bullosa – Rare Disease and big Business

Epidermolysis bullosa – Rare Disease and big Business

Florian Kaiser, BIOT *6610

Winter semester 2019


The company Paragon Bioscience was founded in 2010 by Jeff Aronin, who serves as chairman of the company [1]. The intention of Paragon Bioscience is to found other companies with the goal to develop orphan drugs. “When we find an opportunity for life-changing care, Paragon forms and incubates companies to develop those therapies,” said Mr. Aronin [2]. One of these companies created and supported by Paragon is Castle Creek Pharmaceuticals in 2015. Paragon Bioscience invested a total amount of $122.5 million to found Castle Creek. “Paragon founded Castle Creek with the vision to deliver transformative therapies to patients with rare genetic dermatologic diseases, including Epidermolysis Bullosa Simplex,” said Paragon Biosciences CEO Jeff Aronin [3].


Epidermolysis Bullosa (EB)

EB is considered one of more than 6 000 rare diseases. A rare disease is defined by the U.S. Food and Drug Administration (FDA) as a disease which affects less than 200 000 people in the United States (US) [4]. In the US the likelihood that a child is born with EB is 1 to 20 000, however it is estimated that roughly 15 000 to 20 000 people suffer on EB in the US. The three main subtypes of EB are EB simplex (EBS), Junctional EB (JEB) and Dystrophic EB (DEB), where EBS occurs at most. All these variations show mutations in genes which are responsible for the production of proteins that are needed within the skin to hold the different skin layers together. The proteins act as a “glue” or as “anchors” between the skin layers and with the absence of the correct forms of these proteins, due to the occurrence of mutations, the appearance of painful blisters can be a consequence [5].

In EBS the mutations occur in the genes KRT5 and KRT14 which lead to improper formation of the keratin 5 or keratin 14 proteins and consequently to an instable intermediate filament network (IFN). Subsequently, keratin aggregates are formed and eventually basal keratinocytes rupture when physical stress is applied and that lead to blisters and wounds. A positive feedback loop of the inflammatory signaling pathway could be observed in in vitro studies, induced by keratin aggregates which lead to an enhanced secretion of interleukin 1β (IL-1β) and eventually lead to an increased expression of the defect keratin 14 protein [6].

EBS can be inherited in two different ways. Autosomal dominant, where one parent is also affected by EBS. The other inheritance possibility is autosomal recessive, where each parent carries the gene mutation on one allele but both parents are healthy. Another way is that the mutation is spontaneously introduced into the genome of an infant [7].

Currently, there is no cure for patients with EBS available. There are approaches to delete the gene mutations in skin cells with gene editing techniques or transplantation of skin cells or stems cells without mutations. However, these therapies are still in their very early stages and decades away to become a common treatment method.


Castle Creek

Castle Creek’s office is located in New Jersey since 2015. Their focus is to develop and provide patients with drugs for the treatment of orphan diseases. Often, there are no drugs against severe rare diseases available [8] Currently, Castle Creek has four different drug candidates in the development stage for the treatment of rare genetic dermatologic diseases, including Vitiligo. They proclaim that their own drug candidates have the potential to enter the market within the next 2-3 years [9]. The most advanced drug candidate in the clinical trials is a 1% diacerein cream for the treatment of EBS. “With no approved treatment available, patients may be unable to participate in many daily activities and often experience severe pain”, said Amir Tavakkol, executive vice president and chief development officer at Castle Creek Pharmaceuticals [10].

Jeff Aronin the CEO of Paragon Biosciences was awarded in 2018 by Best in Biz as innovator of the year for his 20 years engagement to identify unmet patient needs and develop novel drugs for the treatment of orphan diseases. Until yet Jeff Aronin could achieve to receive 13 Novel Drug Approvals by the FDA for the companies he had formed [11].



Diacerein (CCP-020) is a small molecular weight compound and is the drug that is currently under development by Castel Creek for the treatment of EBS. The goal of this drug is not to cure EBS but to decrease the pain by accelerating the healing process of patient’s blisters and wounds. In vitro studies revealed that diacerein is able to down regulate the IL-1β signal pathway which lead to a decrease expression of the protein keratin 14 and a more stable IFN and less disrupted basal keratinocytes [6].

In June 2018 Castle Creek announced the launch of a pharmacokinetics (PK) study by treating the first EBS patient with a 1% diacerein cream. This phase 1 trial should be performed as a global study in the United States and Europe with 16-20 enrolled EBS patients including infants, children and adults for a treatment duration of 10 days. The goal of this study is to assess PK, safety and adverse events of the 1% diacerein ointment. “There has been no treatment available and most of the EB community is excited to participate in anything that will give researchers knowledge of the disease as a whole,” said Dr. Aída Lugo-Somolinos, principal investigator at UNC-Chapel Hill [12].

An already completed phase 2 study about the treatment with 1% diacerein cream was published in the “Journal of the American Academy of Dermatology”. The study was performed in US, France and Austria and showed advantages in the healing of blisters and wounds of EBS patients by applying Caste Creek’s drug. In this study 17 patients with EBS from four different countries were treated with the 1% diacerein cream. After a treatment of 4 weeks the results were compared to the initial status by counting blisters in a certain body area. It was predefined that it is clinical meaningful if there is a reduction of at least 40% blisters observed. The goal could be achieved in 60% of the EBS patients treated with 1% diacerein cream. During the application no negative effect could be related to the drug. However, the number of patients in this study was very low and more studies have to be performed to confirm these positive results [6].

Recently, another phase 2 study to test the 1% diacerein cream (TWiB’s code name: AC-203) application was nearly completed in Taiwan. The study was performed by TWi Biotechnology Inc. (TWiB) an international partner company from Castle Creek. They announced in January 2019 that the last patient of the trial is already enrolled. The goal was also to assess the efficacy, safety and reduction of blister area. It is expected that the report with the outcome of this study will be released in the second quarter of 2019. “We are committed to bring AC-203 treatment to EB patients and believe the results of this study will be an essential step for future global registration trial in partnership with Castle Creek Pharmaceuticals,” said Calvin Chen Chief Executive Officer of TWiB [13].


Attractive market: Rare diseases

“Fast Track designation is an important milestone in our development program for CCP-020 and reinforces the critical unmet need for patients who are living with the risk of severe blistering and skin erosion associated with EBS,” Amir Tavakkol, PhD, executive vice president and chief development officer at Castle Creek Pharmaceuticals [14].

The US Orphan Drug Act from 1983 ensure the financial benefit of developing drugs for rare diseases. Nowadays, also the European Union (EU) and Japan have similar laws which include incentives and decrease taxes to support the development of drugs for the treatment of rare diseases. In the US there is a 7 years marketing exclusivity for orphan drugs and in the EU a 10 years marketing exclusivity from approval on, respectively. The R&D costs for orphan drugs are lower compared to non-orphan drugs, especially the expenses in phase 3 can be 50 to 75% less. This is an essential amount of money for companies in the drug development flied, considering that the total expenses to launch a new non-orphan drug on the market are estimated to hit $2.6 billion with a success rate of less than 12% in the clinical trial phases [15]. The US and EU support companies with grants for the clinical trials, tax credit discounts, protocol -, administrative – and procedural assistance for small and medium companies, makes the field of orphan drug development an attractive market for these companies. However, seven of the top ten orphan drug owners are considered as big pharma companies. The fact, defined by legislation, that clinical trials can be performed in a shorter time range due to the lower number of test subjects in the clinical trials compared to non-orphan drugs is another incentive. Although, the overall demand on orphan drugs is small the average annual cost per patient for an orphan drug is very high. Considering the 100 top orphan drugs, the average costs per patient and year was in the US in 2017 with $147,308 significantly higher compared to $30,708 for non-orphan drugs. This is an opportunity for orphan drug producers to generate high revenue.

The annual market growth rate for orphan drugs is two-fold higher compared to non-orphan drugs. In 2024 it is expected that the orphan drug market has a volume of $262 billion [16] [17].


Big Pharma vs small Biotech Companies

Since, the Orphan Drug Act and other orphan drug supporting laws in Europe and Japan, facilitate the development of rare diseases treating medicines, this class of drugs became a more and more attractive business. Also the fact that it is possible to sell orphan drugs for much higher prices compared to non-orphan drugs draws the attention of big pharma companies to the market with small patient numbers.

The costs and trial size advantages in the development of orphan drugs offer a chance and possibility for smaller Biotech companies owing a lower budget to run clinical trials. However, if an orphan drug achieves beneficial outcome and it seems to be a promising medication, a big pharma company often makes efforts to purchase the license of the drug or even try to acquire the whole company. The Biotech company Genzyme launched a highly effective drug named Cerezyme on the orphan drug market for the treatment of Morbus Gaucher, a rare genetic disease which has a negative impact on the organ function. The treatment cost with Cerezyme was $300,000 per patient and year. As a result Genzyme could achieve sales over $700 million for their orphan drug in 2010. Consequently, Sanofi, a Big Pharma company, purchased Genzyme in 2011 and incorporated the smaller Biotech enterprise into their company [18] [19].


Setback and Outlook

By visiting the homepage of Caste Creek it is a bit odd that the last news release about the ongoing study of 1% diacerein was from October 2018. Then I found an article from “Endpoint News” with the title “Fresh from a $72M raise, Jeff Aronin’s new lead rare disease drug is flagged as a failure”. In an email statement Castle Creek’s Co-founder, Michael Derby announced the termination and currently failure of the phase 2 study for the diacerein cream. After an assessment from an “Independent Data Monitoring Committee” Castle Creek had to terminate the pursue of their drug for the treatment of EBS due to lack of statistical robustness on efficacy [20]. The drug application is possibly related to cause Diabetic nephropathies, a serious kidney-related complication which negatively impacts the removal of waste products and fluid from the body [21]. However, Castle Creek allowed the patients which were enrolled in the phase 2 studies to continue the treatment of 1% diacerein cream in an open-label extension trail. Michael Derby also proclaimed that they will continue the development of the 1% diacerein cream with the start of a phase 3 study, although the phase 2 study is currently discontinued. With another investment of $71.8 million in October 2018, they try to find appropriate safety and efficacy results to get approval for phase 2. Michael Derby commented the termination of phase 2 study as followed, “showed several positive trends in key efficacy measures and a benign safety profile that strongly support continued phase 3 development of this potential treatment, which is our plan” [20].




[1]          “Jeff Aronin,” Jeff Aronin. [Online]. Available: https://www.jeffaronin.com/. [Accessed: 09-Mar-2019].

[2]          “Paragon Biosciences Chairman and CEO Jeff Aronin is Named Innovator of the Year by Best in Biz,” Benzinga. [Online]. Available: https://www.benzinga.com/pressreleases/18/12/r12789583/paragon-biosciences-chairman-and-ceo-jeff-aronin-is-named-innovator-of. [Accessed: 22-Mar-2019].

[3]          M. Derby, “Castle Creek Pharma Announces $71.8 Million in New Investment to Expand Research for Rare Dermatologic Conditions,” Castle Creek Pharma, 19-Oct-2018. .

[4]          C. for D. E. and Research, “Information for Consumers (Drugs) – Orphan Products: Hope for People With Rare Diseases.” [Online]. Available: https://www.fda.gov/drugs/resourcesforyou/consumers/ucm143563.htm. [Accessed: 09-Mar-2019].

[5]          “Patients – Castle Creek Pharma.” [Online]. Available: https://www.castlecreekpharma.com/patients/. [Accessed: 20-Mar-2019].

[6]          V. Wally et al., “Diacerein orphan drug development for epidermolysis bullosa simplex: A phase 2/3 randomized, placebo-controlled, double-blind clinical trial,” J. Am. Acad. Dermatol., vol. 78, no. 5, pp. 892-901.e7, May 2018.

[7]          G. H. Reference, “Epidermolysis bullosa simplex,” Genetics Home Reference. [Online]. Available: https://ghr.nlm.nih.gov/condition/epidermolysis-bullosa-simplex. [Accessed: 11-Mar-2019].

[8]          “About Us – Castle Creek Pharma.” [Online]. Available: https://www.castlecreekpharma.com/about-us/. [Accessed: 22-Mar-2019].

[9]          “Pipeline – Castle Creek Pharma.” [Online]. Available: https://www.castlecreekpharma.com/pipeline/. [Accessed: 22-Mar-2019].

[10]        “Pharmacy Choice – Pharmaceutical News – Castle Creek Pharmaceuticals Receives FDA Fast Track Designation for Diacerein 1% Ointment for Treatment of Epidermolysis Bullosa Simplex – March 22, 2019.” [Online]. Available: https://www.pharmacychoice.com/news/article.cfm?Article_ID=2070799. [Accessed: 22-Mar-2019].

[11]        “Jeff Aronin,” Jeff Aronin. [Online]. Available: https://www.jeffaronin.com/. [Accessed: 22-Mar-2019].

[12]        “Castle Creek Pharmaceuticals Announces First Patient with Epidermolysis Bullosa Enrolled in Pharmacokinetics Study of Diacerein 1% Ointment,” Paragon Biosciences | Biopharmaceutical Drug Development. [Online]. Available: https://www.paragonbiosci.com/news/2018/7/27/castle-creek-pharmaceuticals-announces-first-patient-with-epidermolysis-bullosa-enrolled-in-pharmacokinetics-study-of-diacerein-1-ointment. [Accessed: 20-Mar-2019].

[13]        “TWi Biotechnology Announces Last Patient Enrolled in Phase 2 Proof-of- Concept Study of AC-203 for Treatment of Epidermolysis Bullosa.” [Online]. Available: https://www.twibiotech.com/website/news_detail/46. [Accessed: 22-Mar-2019].

[14]        “Epidermolysis Bullosa Therapy CCP-020 Gets FDA Fast Track Designation,” Epidermolysis Bullosa News, 13-Aug-2018. .

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[17]        “ORPHAN DRUG REPORT 2018.” EvaluatePharma.

[18]        J. LaMattina, “How Committed is Big Pharma to Rare Diseases?,” Forbes. [Online]. Available: https://www.forbes.com/sites/johnlamattina/2012/05/02/how-committed-is-big-pharma-to-rare-diseases/. [Accessed: 22-Mar-2019].

[19]        D. A. O’Neil, “A better fit? Biotech versus Big Pharma in orphan/rare disease drug research,” Expert Opin. Orphan Drugs, vol. 2, no. 4, pp. 317–319, Apr. 2014.

[20]        “Fresh from a $72M raise, Jeff Aronin’s new lead rare disease drug is flagged as a failure,” Endpoints News. [Online]. Available: https://endpts.com/fresh-from-a-72m-raise-jeff-aronins-new-lead-rare-disease-drug-is-flagged-as-a-failure/. [Accessed: 22-Mar-2019].

[21]        “Diacerein – TWi Biotechnology/Castle Creek Pharmaceuticals – AdisInsight.” [Online]. Available: https://adisinsight.springer.com/drugs/800034135. [Accessed: 22-Mar-2019].


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