Exploring the First in Class: One Molecule, Three Formulations, $7 Billion Market Value
The First Treatment for Common Ocular Diseases
In July 2023, Tarsus Pharmaceuticals’ XDEMVY (lotilaner eye drops 0.25%) was approved by the U.S. FDA for the treatment of demodex blepharitis. This drug is the first and currently the only FDA-approved treatment directly targeting demodex mites, which are the root cause of demodex blepharitis.
Blepharitis is a common chronic eyelid disease that can lead to or exacerbate ocular surface diseases. Typical signs and symptoms include eyelash debris, redness of the eyes and eyelids, eyelash loss or abnormal direction, blurred vision, irritation, itching of the eyelids, and discomfort. Treatment is challenging and often leads to recurrence. Blepharitis can be caused by various factors, including demodex mite infestation, bacterial infection, meibomian gland obstruction, and seborrheic dermatitis. Among these, demodex mite infection is the primary cause, with an estimated 25 million people in the U.S. potentially affected. Tarsus believes that despite underdiagnosis and limited treatment options, approximately 1.5 million new cases are diagnosed annually in the U.S. Demodex blepharitis is a progressive condition, and if not treated promptly, it can lead to more severe symptoms such as blurred vision, eyelash loss, corneal damage, and, in extreme cases, blindness.
Previously, demodex blepharitis was usually treated with various over-the-counter products like tea tree oil, eyelid wipes, and artificial tears, as well as off-label use of dry eye prescription products.
XDEMVY (lotilaner eye drops 0.25%) was formerly known as TP-03. It is a novel antiparasitic molecule belonging to the isoxazoline class. Its active ingredient, lotilaner, is a selective, non-competitive antagonist of the γ-aminobutyric acid-gated chloride channel (GABA-Cl). By selectively inhibiting the GABA-Cl channels in demodex mites or other parasites, it causes paralysis and death of the mites, thus curing demodex blepharitis.
The drug has been shown not to bind with human GABA-Cl or other ion channels (e.g., hERG), hence it does not affect the human nervous system. Additionally, lotilaner is a highly lipophilic molecule, which facilitates its absorption in the oily sebum of hair follicles, where the mites reside.
Lotilaner (TP-03) has completed two pivotal clinical studies in the U.S., achieving both primary and secondary endpoints with good tolerability. The Saturn-2 study enrolled 412 adult patients and showed that 56% of patients in the XDEMVY (lotilaner eye drops) treatment group achieved improvement (fewer than 2 instances of sleeve-like secretions per upper eyelid). The Saturn-1 study enrolled 421 adult patients, and 44% of patients in the XDEMVY treatment group showed improvement.
Beyond demodex blepharitis, Tarsus is also developing TP-03 for the treatment of meibomian gland dysfunction (MGD). MGD is a chronic abnormality of the meibomian glands, which are internal glands in the eyelids that secrete lipids and other molecules crucial for maintaining a healthy tear film on the eye surface. The main feature of MGD is meibomian gland obstruction or destruction, which can lead to a deficient tear film and is one of the major causes of dry eye disease. Approximately 30-40 million people in the U.S. are affected by MGD, and there are currently no FDA-approved medications for its treatment. Clinical signs of MGD have been shown to be associated with short demodex mite infections, and TP-03 aims to alleviate key factors potentially leading to MGD by eradicating short demodex mites and reducing eyelid inflammation caused by these mites.
In December 2023, Tarsus reported positive endpoint results from the Phase 2a Ersa clinical trial, which evaluated TP-03 (0.25%), administered twice or three times daily for 12 weeks, in treating MGD patients with demodex mite infections. The study indicated statistically and clinically significant improvements in two objective disease indicators compared to baseline, measured by meibomian gland secretion scores (MGSS) for fluid presence and quality, as well as the number of glands secreting normal (clear) fluid, with good tolerability. Tarsus plans to discuss and determine potential regulatory pathways with the FDA by the end of 2024.
GrandPharma acquires rights in Greater China
In March 2021, Tarsus Pharmaceuticals and LianBio announced a strategic collaboration, granting Lianluo Bio exclusive rights to develop and commercialize TP-03 in the Greater China region (Mainland China, Hong Kong, Macau, Taiwan). It is estimated that there are about 40 million patients with demodex blepharitis and 70 million patients with MGD in China. According to the agreement, Tarsus received a $15 million upfront payment and potential milestone payments of up to $185 million. Tarsus also acquired a minority stake in Lianluo Bio (which was sold in June 2024).
In October 2023, Lianluo Bio announced the topline data results from the Phase 3 LIBRA clinical study evaluating TP-03 in Chinese patients with demodex blepharitis. The primary endpoints were the eradication rate of mites on day 43 (defined as 0 mites/eyelash) and the cure rate of sleeve-like secretions (Grade 0: defined as 0-2 eyelashes with sleeve-like secretions per eyelid). The results showed a statistically significant eradication rate of mites with TP-03 compared to the placebo group (p<0.001). The cure rate for sleeve-like secretions also showed a positive but not statistically significant trend (p=0.15). TP-03 was well tolerated, with a safety profile similar to results observed in other large-scale clinical trials and no treatment-related discontinuations.
However, with Lianluo Bio announcing its business closure in February this year, the rights to TP-03 in the Greater China region have changed hands again.
In March 2024, GrandPharma announced a strategic cooperation agreement with Lianluo Bio and Tarsus Pharmaceuticals for the introduction of the product. Upon meeting relevant conditions, Yuanda Pharmaceutical will acquire exclusive development, production, and commercialization rights for the globally innovative ophthalmic formulation TP-03 for treating demodex blepharitis and MGD in the Greater China region (Mainland China, Hong Kong, Macau, Taiwan) for a $15 million upfront payment and certain registration milestone fees. After the completion of this transaction, Yuanda Pharmaceutical will vigorously advance the registration process for TP-03 in China to benefit a wide range of patients with demodex blepharitis as soon as possible.
From Eye Drops to Gels and Oral Formulations
Tarsus is advancing its product line to address a range of unmet therapeutic needs, including in ophthalmology, dermatology, and infectious disease prevention.
According to the company’s pipeline, Tarsus is also evaluating a preservative-free version of TP-03 (lotilaner eye drops) in Europe for the treatment of demodex blepharitis. Additionally, the company is actively discussing collaboration opportunities for TP-03 (lotilaner eye drops) in international markets outside the U.S.
In addition to eye drops, Tarsus has developed various formulations of lotilaner for different indications, believing that lotilaner has the potential for a pipeline in a product.
TP-04: Gel Formulation for Rosacea
Tarsus is developing TP-04, a gel formulation of lotilaner, for the treatment of rosacea, also known as rhinophyma. Rosacea is a chronic skin condition characterized by facial redness, inflammatory lesions, burning, and stinging, which may flare up due to triggers such as sun exposure or emotional stress. According to the National Rosacea Society, approximately 16 million people in the U.S. are affected by rosacea, with a global prevalence estimated at about 5.4%. About 55% of rosacea patients have papulopustular rosacea (PPR). The onset of rosacea is influenced by multiple factors, and increasing evidence suggests that demodex mites play a significant role in its development. Studies have found higher densities of demodex mites in the skin of PPR patients, potentially leading to inflammation associated with the condition.
Tarsus has developed TP-04 as a topical formulation with a longer half-life, higher lipophilicity, and a broader therapeutic window, initially targeting papulopustular rosacea (PPR). In February 2024, Tarsus announced positive results from the Phase 2a Galatea trial evaluating TP-04 (a new lotilaner gel formulation) for treating PPR. The trial demonstrated statistically significant improvements in inflammation lesions and Investigator's Global Assessment (IGA) scores at week 12 compared to the placebo group (p<0.05), with overall good tolerability. The company plans to discuss and determine potential regulatory pathways with the FDA by the end of 2024.
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TP-05: Oral Formulation for Lyme Disease Prevention
TP-05 is an oral tablet formulation of lotilaner being developed for Lyme disease prevention. Lyme disease is the most common tick-borne illness in the U.S., caused by the bacterium Borrelia burgdorferi transmitted through tick bites. The disease can be severe, affecting multiple organs and causing a wide range of symptoms. Early symptoms include localized rashes, fever, and fatigue, which can evolve into more severe and sometimes chronic symptoms, including fever, muscle and joint pain, peripheral and central nervous system deficits, and lymphocytic meningitis. It is estimated that there are 300,000 to 400,000 new cases of Lyme disease in the U.S. each year, with about 80 million Americans at risk of exposure, and over 30 million at moderate to high risk.
TP-05 is designed as a novel oral formulation for Lyme disease prevention, aiming to eliminate ticks before they transmit the bacterium. In February 2024, Tarsus announced positive topline results from the Phase 2a proof-of-concept study of TP-05 (lotilaner). This randomized, double-blind, placebo-controlled trial evaluated TP-05's single-dose ability (low dose or high dose) to kill ticks attached to subjects. The study showed statistically significant benefits in tick mortality compared to placebo. Specifically, on day 1 post-treatment, the 24-hour average tick mortality rates for the high and low dose TP-05 groups were 97.0% and 92.0%, respectively, compared to 5.0% in the placebo group. Similarly, after 30 days post-treatment, the 24-hour average tick mortality rates were 89.0% and 91.0% for the high and low dose TP-05 groups, respectively, compared to 9.0% in the placebo group. No statistically significant differences in tick mortality rates were observed between the two TP-05 treatment groups, and TP-05 was generally well tolerated. Tarsus plans to discuss and determine potential regulatory pathways with the FDA by the end of 2024.
The company has disclosed that TP-05 is currently the only non-vaccine preventive medication in development targeting ticks, and thus may become the first and only long-acting, on-demand oral prophylactic drug for Lyme disease prevention.
Additionally, according to the company’s website, TP-05 may also lead to the death of mosquitoes that transmit malaria. Malaria remains one of the most severe unmet public health needs globally, with approximately 247 million cases and over 600,000 deaths annually.
Financial Overview
2023 Full Year
2024 First Half
R&D Expenses by Project (2023 and H1 2024):
Additional Information
References
NMPA/CDE；
FDA/EMA/PMDA；
https://tarsusrx.com/pipeline/;
https://investors.lianbio.com/zh-hans/news-releases/news-release-details/liantashengwugongbutp；
https://ir.tarsusrx.com/news-releases/news-release-details/tarsus-announces-positive-topline-results-carpo-phase-2a-proof