* Drugs mimic body's response to being at high altitude
* Experimental tablets an alternative to injections of EPO
* Astellas and partner FibroGen in lead with Phase III pill
* GSK CEO says excited by potential of its Phase II product
By Ben Hirschler
LONDON, April 19 (Reuters) - Japan's Astellas Pharma and Britain's GlaxoSmithKline are competing todevelop a new kind of medicine that boosts production of redblood cells by making the body think it is at high altitude.
Their experimental drugs - both given as pills - couldcreate a major new market in treating anaemia and other seriousconditions, including circulatory problems and wound damage.
They may also attract unscrupulous athletes seeking a handyoral alternative to injections of EPO, or erythropoietin, theblood enhancer that has become a byword for doping in casesinvolving cyclist Lance Armstrong and others.
So far, the rival pills are not generally on investors'radar, but they could become significant challengers in ananaemia therapy market that is currently dominated by EPOproducts with combined sales of close to $8 billion a year.
GSK Chief Executive Andrew Witty recently highlighted hiscompany's pill, dubbed GSK 1278863, as one of the two mostexciting and innovative products in the development pipelinealongside a promising cancer vaccine called MAGE-A3.
"It is a tablet which makes the body think it is at 5,000feet. When you go and exercise at altitude you produce a lot ofred blood cells, so it has all sorts of potential applicationsin terms of helping people with blood disorders," he told aNational Health Service meeting last month.
GSK is testing its drug in Phase II clinical trials. Thatputs it behind Astellas and its partner FibroGen, which launchedfinal-stage Phase III tests in December of their drug, known asFG-4592 or ASP1517, as an anaemia treatment in patients withchronic kidney disease.
Mike Allen, head of urology and nephrology at Astellas, saidthe new drug marked a major advance compared to EPO, since itdid not raise blood pressure - a concern with EPO. And since itcan be given orally at home, it should be particularly suitablefor kidney patients who are not on hospital dialysis.
"We are very excited about this product and its potential.It is a priority in our portfolio and we do think that as anovel mechanism for this medical need it is very creative andshows great promise," Allen said in an interview.
Astellas placed a big bet on the new approach in 2006 whenit licensed the European and Japanese rights to FG-4592 fromprivate U.S firm FibroGen in a deal potentially worth more than$2 billion. FibroGen retains rights to the drug in the UnitedStates and other markets, and for uses other than anaemia.
Another private U.S. company, Akebia Therapeutics, also hasa similar HIF-prolyl hydroxylase inhibitor in Phase II tests.
OXFORD RESEARCH
Peter Ratcliffe of the University of Oxford, whose teamdiscovered the prolyl hydroxylase enzymes targeted by the newdrugs in 2001, sees a role for them in multiple areas.
In addition to treating anaemia, they might help with majorcirculatory problems such as angina or bad circulation in thelegs, aid repair to the body after tissue is damaged, and reduceinflammatory problems such as colitis in the gut.
The new drugs mimic the body's response to hypoxia, or lowoxygen levels, by increasing the natural production of EPO inthe kidneys.
"The potential advantage over EPO is that these drugs arepills and they also do other things that support the action ofEPO, including facilitating the absorption of iron," Ratcliffesaid. "It could be an important new area of medicine, which isexciting to explore."
Ratcliffe, who is Nuffield Professor of Clinical Medicine atOxford, also works as a consultant to GSK.
Current injectable EPO stimulating agents have been under acloud for some years due to cardiovascular safety concerns. As aresult, the global market has shrunk from a peak of $12 billionin 2006, although products like Amgen's Epogen andAranesp remain multibillion-dollar sellers.
Doctors will be keeping a close watch on potential safetyissues with the new pills, too, as they advance throughlarge-scale clinical testing. So far, there are no signs ofcardiovascular problems. But there is a potential for unwantedside effects given the generalised way in which the drugs work.
The challenge will be to balance the local and generaleffects of medicines that, depending on dose, mimic the effectsof being at between 5,000 and 15,000 feet, Ratcliffe said.
Side effects may be less of a concern for sport cheats.
Allen said Astellas would do whatever was necessary toensure its new drug was not abused, although it is has not yetheld talks with the World Anti-Doping Agency (WADA).
GSK, meanwhile, told WADA last year that it had an unnamedexperimental drug that could boost red blood cell production -the first such notification under a new agreement designed toclamp down on illicit drug use in sport.
A company spokesman said it was GSK's policy not to identify individual compounds under the deal with WADA.
Glaxosmithkline (GSK)