Annual Report 2008
`In Detail
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 1 of 111
`
`

`

`Introduction
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 2 of 111
`
`

`

`Progress in 2008
`
`In 2008, strong financial performance – with a keen eye on
`the bottom line – enabled Actelion to continue its unprec­
`edented growth in the biopharmaceutical sector. Once
`again, this was largely driven by sales of our flagship product
`Tracleer® (bosentan), the undisputed cornerstone therapy for
`pulmonary arterial hypertension (PAH).
`
`In an effort to optimize geographic reach, Actelion has ex­
`panded and enhanced its commercial infrastructure. At the
`end of 2008, the company had 26 sales and marketing orga­
`nizations, including the expansion to Mexico, and 25 other
`countries serviced through partners. This global reach – with
`future expansion to markets such as Russia, as well as re­
`alignment in the key Japanese market – means that Actelion
`is equipped to shape markets for future launches.
`
`We have also been putting processes and infrastructure in
`place to transform novel chemical entities, currently in late­
`stage development, into innovative medicines for patients.
`Our global headcount expanded by more than 300 employ­
`ees in 2008 taking Actelion over 1900 professionals. With
`higher levels of growth expected in the future, office and
`laboratory space, IT infrastructure and the coordination of
`corporate services will be key efficiency factors. Actelion’s
`business center, founded at the end of 2007, has already
`made great progress in addressing these future needs, and
`we have started work on our second R&D building.
`
`With a broad dataset and experience in over 60,000 patients,
`Tracleer® is the best described treatment for PAH. In 2008
`Tracleer® saw the successful market introduction for digital
`ulcers in systemic sclerosis and WHO Functional Class II pa­
`tients added to the label in the EU. Having secured the ex­
`panded label, Actelion intends to continue its commitment to
`patients with PAH by building a product franchise led by the
`global availability of Tracleer® and our commercialization of
`Ventavis® (iloprost) in the US. In addition, our Phase III com­
`pound macitentan is continuing to progress rapidly through
`development. Thanks to Actelion’s partnership with Nippon
`Shinyaku, announced in the first quarter of 2008, an orally
`active non-prostanoid PGI2 receptor agonist has also been
`added to the development pipeline.
`
`We also continued our commitment to Zavesca® in 2008,
`not only in the market place but also with clinical support
`resulting in the CHMP positive opinion in December to
`extend the use of this treatment to include patients with a
`very rare neurodegenerative genetic disease, Niemann-Pick
`type C.
`
`03
`
`The Zavesca® sales force is now making the necessary
`preparations to immediately bring this product to patients
`after obtaining approval in the EU in January 2009.
`
`Our clinical development pipeline holds great promise for pa­
`tients with many other unmet medical needs. Results from
`the current Phase III study with bosentan (Tracleer®) as a
`treatment for idiopathic pulmonary fibrosis are expected to
`become available toward the end of 2009. A positive out­
`come would allow patients to benefit from this compound’s
`antifibrotic properties. Also expected for the second half of
`2009 are results from two other Phase III projects, inves­
`tigating clazosentan in the prevention of vasospasm as a
`consequence of aneurysmal subarachnoid hemorrhage and
`almorexant in primary insomnia.
`
`Almorexant shows potential in the treatment of insomnia
`and beyond. To optimize the value of this discovery, Actelion
`sought a partner who understood this potential. The
`partnership with GlaxoSmithKline, announced in July 2008,
`has proved to be a good choice, with rapid and committed
`implementation. The two companies’ combined knowledge,
`capabilities and experience will allow us to realize the
`transformational potential of almorexant and other orexin
`receptor antagonists, creating value above and beyond
`what each company could achieve alone. The alliance also
`allows Actelion to potentially build a primary care presence
`in key pharmaceutical markets, driving almorexant's value
`creation and helping to maximize leverage for our substantial
`pipeline.
`
`As data is reported from our early-stage development pro­
`grams, we will learn more about the potential of our CRTH2
`receptor antagonist in allergic asthma and the initiation of
`Phase II studies for the S1P1 receptor agonist (in partnership
`with Roche). We also hope to benefit from a drug discovery
`approach in which compound identification is followed by a
`patient-oriented search for therapeutic applications.
`
`Our corporate culture – combining the innovation, entrepre­
`neurial spirit and flexibility of biotech with the risk manage­
`ment and regulatory and commercial discipline of big pharma
`– will continue to drive our success in 2009. By focusing on
`our values and fostering an enthusiastic, stimulating environ­
`ment for employee development and company growth, we
`will attract and retain the best people in the industry.
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 3 of 111
`
`

`

`Contents
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 4 of 111
`
`

`

`05 Partnerships & Collaborations
`
`Partnerships
`In-licensing
`Acquisitions
`
`06 Marketed Products
`
`Actelion’s products in the marketplace
`About Tracleer®
`About Ventavis®
`About Zavesca®
`
`07 Financial Report
`
`Financial summary
`Corporate Governance
`Consolidated Financial Statements
`Notes to the Consolidated Financial Statements
`Holding Company Statements
`Notes to the Financial Statements 2008
`Actelion Management, Board and
`Scientific Advisory Board
`Shareholder Information
`
`35
`
`36
`37
`38
`
`39
`
`40
`41
`45
`46
`
`49
`
`50
`53
`65
`69
`97
`98
`
`109
`110
`
`06
`
`08
`
`10
`
`11
`13
`13
`13
`15
`16
`17
`19
`19
`
`21
`
`22
`23
`23
`24
`24
`26
`26
`28
`29
`30
`30
`30
`31
`32
`32
`33
`33
`
`01 Our strategy
`
`02 Our people and values
`
`03 Research
`
`Research strategy
`Project selection
`Therapeutic areas
`Cardiovascular disorders
`Central nervous system
`Genetic disorders
`Immunology
`Infectious diseases
`Oncology
`
`04 Development
`
`Development pipeline
`Phase IV
`Bosentan (Tracleer®)
`Iloprost (Ventavis®)
`Miglustat (Zavesca®)
`Phase III
`Almorexant
`Bosentan in IPF
`Clazosentan
`Macitentan
`Phase II
`CRTH2 receptor antagonist
`Miglustat in cystic fibrosis
`PGI2 receptor agonist
`S1P1 receptor agonist
`Phase I
`Renin inhibitor
`
`05
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 5 of 111
`
`

`

`01 Our strategy
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 6 of 111
`
`

`

`Securing a successful future
`
`Since its founding more than a decade ago, Actelion has be­
`come a new kind of biopharmaceutical company: one that
`blends biotech‘s innovation, speed and flexibility with big
`pharma‘s operating discipline and excellence in execution.
`With the intrinsic belief that innovation in all domains is the
`key to growth, Actelion has built a global biopharmaceuti­
`cal leader with a robust pipeline, three approved products,
`and commercial operations in more than 25 countries. Our
`over 1’900 employees have a common purpose: to improve
`patients’ lives by creating innovative medicines that make a
`real difference.
`
`Four key principles strengthen Actelion’s
`strategy:
`
`1. Follow innovation where it leads
`We pursue innovation - internal and external - balancing scien­
`tific merit, unmet medical needs and commercial potential.
`
`2. Retain the value of innovation
`We develop projects within the company, consider partner­
`ships for strategic or financial benefit; if appropriate to maxi­
`mize long-term value creation and to strengthen company
`infrastructure and reach.
`
`3. Seek licensing deals or acquisitions that are synergetic to
`existing businesses or to provide an infrastructure plat­
`form for pipeline products.
`
`4. Focus on people: It takes professionals from many areas
`of expertise, working together over a sustained period
`of time, to create an innovative medicine. We know that
`products don’t discover or sell themselves and so con­
`tinue to grow our innovative team of creative minds.
`
`The Future for Actelion
`
`Actelion is on the verge of transforming itself into an orga­
`nization with a much larger footprint. The success of any of
`the four ongoing major Phase III programs – bosentan for
`Idiopathic Pulmonary Fibrosis (IPF), clazosentan for vasos­
`pasm after aneurysmal subarachnoid hemorrhage (aSAH),
`almorexant for insomnia and macitentan for pulmonary arte­
`rial hypertension – could accelerate Actelion’s growth over
`the next decade. While pursuing the key components of our
`strategy, we must carefully plan for success and anticipate
`the needs of a much larger organization.
`
`Even if only two of these programs are ultimately successful,
`Actelion will undoubtedly become one of the world’s leading
`and largest biopharmaceutical companies.
`
`3. Excel in sales and marketing
`We aim to continue to expand our highly experienced com­
`mercial team into new territories as well as new markets
`when we have suitable products.
`
`It is my belief that only when all of our desire and drive is
`focused on being number one, in everything we do, can we
`really turn innovation into value.
`Jean-Paul Clozel, CEO
`
`4. Retain core values, culture and independence
`We constantly strive to strengthen our culture of Innovation,
`Trust and Teamwork and Open Communication to foster an
`enthusiastic and stimulating environment for employees. At
`the same time we maintain our Results Driven orientation.
`
`The key components of Actelion’s strategy
`are:
`
`1. Build our existing businesses in PAH and lipid storage dis­
`orders whilst developing or licensing additional synergetic
`products.
`
`2. Pursue an R&D-focused growth strategy by pursuing in­
`ternal projects, especially those which would accelerate
`value creation. Selectively form partnerships for these
`products to optimize risk, investment and return.
`
`07
`
`01 Our strategy
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 7 of 111
`
`

`

`02 Our people
`
`and values
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 8 of 111
`
`

`

`Our employees - Together we innovate
`
`At Actelion, people make the difference
`
`Throughout its years of rapid growth, Actelion has always
`been highly conscious of the fact that it’s people who make
`the difference. In turn, we have made sure our employees
`understand that we expect each of them to make a signifi­
`cant contribution.
`
`Actelion acknowledges that people come to us from diverse
`backgrounds, both culturally and professionally. We strive to
`provide our employees with the best environment in which
`they can fulfill their individual aspirations and contribute to
`innovative medicines that positively affect patients’ lives.
`
`Actelion's CEO, Jean-Paul Clozel, spends a considerable
`amount of his time working to foster a corporate culture in
`which innovation is the focus. As a company, we have de­
`fined the professional development of our employees as a
`strategic priority. On a day-to-day basis, we undertake sub­
`stantial improvements in infrastructure and the services pro­
`vided to our rapidly expanding workforce. In this way, we can
`ensure a well-resourced environment conducive to optimal
`productivity.
`
`Actelion’s business momentum is mirrored in the growing
`number of employees. Our staff represents the best profes­
`sional attributes and the highest ethical standards. We place
`high priority on attracting, developing and retaining highly tal­
`ented people. Employees identify with the goals and values
`of our company and turn the vision of Actelion’s founders
`into reality: People with passion and expertise are paving the
`way to our future success.
`
`Our values
`
`A culture focused on innovation, trust and teamwork enables
`Actelion to flourish in the biopharmaceutical sector by at­
`tracting and retaining the best people in the industry. Our
`open communication and a results-driven approach fosters
`an enthusiastic, stimulating environment for both employee
`and company development.
`
`Innovation
`Actelion has a keen understanding of the entrepreneurial
`spirit. We know the importance of enabling freedom to im­
`prove people’s lives by creating medicines that make a real
`difference. This shared “patients-first” mindset drives us to
`achieve our goals.
`
`Trust & Teamwork
`Trust and teamwork is key to everything we have accom­
`plished. Through sharing ideas and responsibilities, we en­
`hance our expertise and skills – because working together
`yields greater results.
`
`Open Communication
`To rapidly advance our projects, we need to make sound de­
`cisions based on facts. We identified open communication
`as a vital way to share information and knowledge in order
`to recognize risks as well as opportunities early on. This en­
`sures efficiency and the effective use of our resources.
`
`Results Driven
`Actelion strives to improve patients’ lives and is therefore
`committed to rapidly advance its pipeline. We are consistent
`and clear in decision-making and focus on simple, practical
`approaches to provide innovative life-changing drugs to pa­
`tients.
`
`09
`
`02 Our people and values
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 9 of 111
`
`

`

`03 Research
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 10 of 111
`
`

`

`Research strategy
`
`Scientists at Actelion use an inquisitive drug hunting ap­
`proach to discover and develop novel medicines to improve
`patients' lives.
`
`From the outset, Actelion's founders wanted to create a
`company with a bold, pioneering spirit, one that understands
`the true nature of innovation. The founders understood that
`innovation could not be taught, but the right environment to
`allow innovation can be fostered. Actelion’s productivity is
`evidence that from creative freedom, innovative ideas flour­
`ish.
`
`By removing the barriers to innovation, such as bureaucracy
`and hierarchy, the founders set out to empower “their” peo­
`ple. In turn, Actelion’s people take ownership of their proj­
`ects and grasp opportunities.
`
`There are many barriers to overcome when guiding a com­
`pound that addresses an unmet medical need from the bench
`to the market. To maximize success, the Research and De­
`velopment teams must know which projects are most prom­
`ising, which compounds should be promoted, and where to
`focus their efforts.
`
`The only way to make the correct choices is to base these
`decisions on all facts available. This means open, effective
`communication within teams and across functions in an in­
`tegrated approach.
`
`This sharing of knowledge stimulates and builds scientific in­
`tuition. By using this approach, innovation can be translated
`into evidence-based medicine.
`
`Drug discovery process
`
`To maximize output from its focus on target families, Actelion
`implements appropriate state-of-the-art technologies. The
`Drug Discovery group, comprising of 310 professionals at
`the end of 2008, combines technology with human expertise
`and teamwork in a single research center based in Allschwil
`to make the best use of Actelion's toolbox.
`
`Actelion has over 100 medicinal and process chemists creat­
`ing low molecular weight compounds which go through a
`cyclic drug discovery process for optimization.
`
`molecular drug targets. The characterization includes the
`development of a variety of assays and execution of activ­
`ity screens. The vast quantities of assay result data gener­
`ated, more than 3.8 million data points in 2008, are managed
`and analyzed by data-management programs developed in­
`house.
`
`A lead compound is then passed to our pharmacologists,
`neurobiologists, immunologists and electrophysiologists to
`further characterize the compounds. These lead compounds
`are then passed back through this cycle until an optimized
`compound is available for preclinical development by our
`pharmacokineticists, formulation specialists, and toxicolo­
`gists.
`
`At the end of 2008 the platform approach, combined with our
`technological capabilities and in-house expertise, resulted in
`three compounds undergoing preclinical investigation, with
`the potential selection of several other preclinical candidates
`during 2009. The final outcome is a robust clinical develop­
`ment pipeline of compounds discovered and optimized in
`Actelion’s laboratories.
`
`Platform approach
`
`Actelion’s efforts in drug discovery have focused on develop­
`ing platforms of expertise based on its core capabilities. This
`focus allows high productivity in the generation of innovative
`compounds potentially addressing a wide range of highly un­
`met medical needs.
`
`The first focus is the design, synthesis and optimization of
`low molecular weight drug-like molecules. The productiv­
`ity of the drug discovery endeavors is demonstrated by the
`more than 1,300 pending patent applications and/or granted
`patents currently in Actelion’s portfolio. In 2008, the com­
`pany filed 52 priority patent applications, an indication of very
`high research productivity.
`
`Actelion also focuses on the choice of its molecular target
`families. Initially, the company looked solely at G-protein
`coupled receptors (GPCRs) and aspartic proteinases. As the
`company’s capabilities have expanded so too have the target
`platforms to include anti-infectives and ion channels.
`
`New chemical entities
`
`These innovative compounds are then characterized by mo­
`lecular biologists and biochemists in relation to the chosen
`
`Actelion's research focuses on the design and synthesis of
`novel low molecular weight drug-like molecules. Experience
`
`11
`
`03 Research
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 11 of 111
`
`

`

`Ion channels
`
`Ion channels are transmembrane pores that allow the pas­
`sage of ions (charged molecules) into or out of a cell. There
`are hundreds of different ion channels, distinguished by ion
`selectivity, opening mechanism, and protein sequence. Ion
`channels can be opened by chemical ligands, voltage fluctua­
`tions, acidity changes, temperature variations, or mechanical
`stimuli (e.g. touch or sound).
`
`In mid-2004, Actelion established an in-house in-vitro elec­
`trophysiology group. This was primarily to provide internal
`support for early preclinical evaluation of drug safety in the
`area of cardiac electrophysiology.
`
`Since the scientific knowledge and technical capabilities re­
`quired in this area are very similar to those in the area of car­
`diovascular ion channel therapies, research programs were
`soon initiated looking for modulators of selected ion chan­
`nels to treat cardiovascular diseases.
`
`Expansion of the electrophysiology group and integration of
`new expertise and technologies led to the initiation of re­
`search projects targeting ion channels to treat neurological
`and immunological diseases.
`
`Anti-infectives
`
`Due to the development of resistance to currently available
`antibiotics and the emergence of new pathogens, the medi­
`cal need for new antibiotic compounds is high. In order to
`address this high unmet medical need, Actelion initiated, in
`2004, a research program in the field of antibiotics.
`
`Actelion’s focus is on the discovery of novel classes of
`antibiotics that may offer improved properties, such as in­
`creased potency, coverage of multi-resistant pathogens, and
`a decreased inherent liability for resistance development. A
`portfolio of projects has been established focusing on both
`antibiotics for intravenous treatment of severe hospital infec­
`tions, and oral antibiotics for community acquired infections.
`
`has shown that small molecules generally lend themselves
`to easier formulation, have a broader array of dosage forms,
`have greater potential for bioavailability, in particular after
`oral administration, and are more efficiently manufactured.
`While Actelion’s medicinal chemistry and high-throughput
`chemistry groups synthesize smaller quantities of structur­
`ally diverse molecules, process research chemists prepare
`the quantities of selected compounds needed for further
`studies.
`
`G-Protein coupled receptors
`
`G-Protein coupled receptors (GPCRs), also known as seven
`transmembrane domain receptors (7TMs), are integral mem­
`brane proteins. They can be activated by external signals,
`such as hormones, neurotransmitters, or odors. This activa­
`tion induces a conformational change of the receptor which
`in turn causes activation of G-proteins and the subsequent
`transmission of biochemical signals within the cell.
`
`There are more than a hundred known GPCRs in humans,
`and many of them are involved in a broad range of diseases.
`
`Some of these receptors are the subject of our development
`programs, such as the endothelin receptors ETA and ETB,
`orexin receptors OX1 and OX2, or the sphingosine-1-phos­
`phate receptor S1P1.
`
`Aspartic proteinases
`
`Aspartic proteinases are a class of enzymes that promote
`chemical reactions inside and outside cells. To perform their
`function, aspartic proteinases use an arrangement of two as­
`partic acids in order to activate a water molecule that acts as
`a chemical “scissor”.
`
`There are more than 50 known aspartic proteinases, of which
`at least nine are currently known to exist in humans. Al­
`though knowledge of their precise physiological roles is still
`emerging, they have been implicated in cancer, as well as in
`inflammatory, degenerative, and cardiovascular diseases.
`
`In addition, aspartic proteinases play a vital role in organisms
`that cause infections, including parasites, fungi, and retrovi­
`ruses such as HIV.
`
`Members of the aspartic proteinase family are the subject of
`our research and development programs, such as the renin
`inhibitor program.
`
`12
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 12 of 111
`
`

`

`Project selection
`
`Actelion selects its molecular drug targets on the basis of
`the established platforms of expertise, capabilities, technol­
`ogies and the professionals at its research center. Actelion’s
`inquisitive researchers all have the opportunity to suggest
`a new target and follow the evaluation process. Additional
`selection criteria which the proposed projects are required
`to demonstrate include:
`
`• medical need
`•
`therapeutic novelty
`•
`predictive animal models
`•
`clinical feasibility
`
`Therapeutic areas
`
`Actelion endeavors to follow innovation where it leads,
`as evidenced by the fact that from a few target platforms,
`Actelion’s compounds have found, or might find, applications
`in multiple disease areas, such as cardiovascular diseases,
`central nervous system disorders, immunological disorders
`and infectious diseases. In 2007, Actelion expanded its re­
`search efforts by adding a dedicated oncology unit to evalu­
`ate all ongoing efforts for further potential applications in the
`field of cancer.
`
`Cardiovascular disorders
`
`Cardiovascular disorders encompass all conditions where
`there is a disturbance in the function of the heart or blood
`vessels. Cardiovascular disease accounts for more than one
`death in three in industrialized countries, and accounts for an
`increasing proportion of death in the developing world.
`
`Actelion's focus
`
`The endothelium
`
`Endothelial cells produce several vasoactive chemical fac­
`tors including endothelin, nitric oxide and prostacyclin.
`
`Endothelin system
`
`Endothelin
`Endothelial cells produce several vasoactive chemical fac­
`tors, among them endothelin and nitric oxide, which work in
`opposition. Nitric oxide dilates blood vessels, prevents plate­
`let adhesion, and inhibits cell proliferation.
`
`Endothelin, however, is a powerful blood vessel constrictor
`that also promotes cell proliferation. In a normal healthy state,
`the body maintains a balance between nitric oxide and en­
`dothelin. In contrast, in certain disease states endothelin is
`produced in excess. In addition to causing vasoconstriction
`– the narrowing of blood vessels – excessive endothelin can:
`
`•
`
`•
`
`•
`
`stiffen blood vessels and tissues by promoting fibrosis,
`the accumulation of connective tissue
`cause vascular remodeling (a change in the vessels'
`structure), vascular hypertrophy (an increase in the thick­
`ness of blood vessel walls), and cardiac hypertrophy
`predispose the vessels to inflammation
`
`Endothelin receptors
`Endothelin binds to two types of receptors found on the blood
`vessel walls and in tissues: ETA receptors, which are found
`predominantly in smooth muscle cells in the blood vessels,
`and ETB receptors, which are also found in fibroblasts, neu­
`ronal cells, endothelial cells, and hormone-producing cells.
`
`The activation of the endothelin system plays a critical role
`in chronic cardiovascular diseases, such as pulmonary hy­
`pertension, and in acute cardiovascular conditions, such as
`right heart failure and cerebral vasospasm – a constriction
`of blood vessels in the brain following subarachnoid hem­
`orrhage. It is also implicated in connective tissue diseases
`such as scleroderma and pulmonary fibrosis. Endothelin
`levels have been shown to correlate with disease severity.
`Among Actelion's endothelin receptor antagonists are oral
`dual ETA-ETB antagonists, and an intravenous selective ETA
`antagonist for cerebral vasospasm, which block the conse­
`quences of excessive endothelin.
`
`The endothelium is an organ consisting of a single layer of
`cells between the blood stream and the blood vessel wall.
`The main functions of the endothelium include:
`
`Prostacyclin system
`
`• maintenance of blood vessel tone, which is critical for
`regulating blood pressure levels
`prevention of blood clots forming on the vessel wall by
`providing a non-adhesive surface
`
`•
`
`Prostacyclin
`Endothelial cells produce several vasoactive chemical fac­
`tors, among them prostacyclin (PGI2), which induce vasodi­
`latation of blood vessels and inhibit smooth muscle cell pro­
`liferation and platelet aggregation. The peptide endothelin is
`
`13
`
`03 Research
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 13 of 111
`
`

`

`also produced by the endothelium, and is a potent constrictor
`of blood vessels and promotes cell proliferation. In a normal
`healthy state, prostacyclin helps counter-balance the ac­
`tions of endothelin. In certain disease conditions, however,
`production of prostacyclin by the endothelium is impaired,
`allowing the deleterious effects of excessive levels of en­
`dothelin to predominate.
`
`Prostacyclin receptor (IP)
`Prostacyclin binds the prostacyclin receptor (IP) located on
`the surface of platelets and vascular smooth muscle cells.
`The IP receptor is a G-protein coupled receptor that, upon
`activation by prostacyclin, stimulates the formation of cyclic
`adenosine monophosphate (cAMP). Dysfunction of the pros­
`tacyclin system occurs in several cardiovascular disorders,
`including thrombosis, myocardial infarction, stroke, myo­
`cardial ischemia, atherosclerosis and pulmonary arterial hy­
`pertension (PAH). Restoration of prostacyclin function using
`prostacyclin analogues that activate IP receptors improves
`prognosis for patients with PAH. Prostacyclin counteracts
`the vasoconstrictor and pro-thrombotic activity of endothe­
`lin. Actelion is developing an orally available and long-acting
`non-prostanoid IP receptor agonist that mimics the actions
`of endogenous prostacyclin for the treatment of PAH.
`
`Disorders of the endothelium
`
`Pulmonary arterial hypertension
`
`Pulmonary arterial hypertension (PAH) is a serious disease
`of the pulmonary arteries connecting the right side of the
`heart to the lungs. Under normal conditions, the lower right
`chamber of the heart (the right ventricle) pumps venous
`blood through the lungs, so the blood can pick up oxygen.
`PAH develops as a consequence of increasingly restricted
`blood flow through the pulmonary arteries. Pressure increas­
`es within the pulmonary arteries, which puts the right side
`of the heart under increased strain to pump blood through to
`the lungs. Right ventricular failure may ultimately result. PAH
`may be idiopathic (no known cause) or secondary to other
`diseases such as scleroderma, congenital heart disease and
`HIV.
`
`Digital ulcers in systemic sclerosis
`
`Systemic sclerosis (SSc) is a chronic autoimmune connective
`tissue disease characterized by excessive collagen deposi­
`tion in the skin and internal organs, such as the gastrointes­
`tinal tract, kidney, heart, and lungs. Symptoms result from
`vascular dysfunction, inflammation, and progressive fibrosis,
`which lead to occlusion of the microvasculature.
`
`As a result of the vascular injury, complications such as
`pulmonary arterial hypertension (approximately 100,000 to
`200,000 PAH patients worldwide) and digital ulcers (approxi­
`mately 5,000 severe cases every year worldwide) can occur.
`Around 40% - 50% of systemic sclerosis patients suffer from
`digital ulcers (DUs) at least once in their disease history. DUs
`are very painful and result in difficult-to-heal open sores that
`occur on fingers and toes. They leave depressed scars and
`adversely impact the ability to perform work and daily activi­
`ties, particularly those associated with fingertip functions. In
`severe cases, infection can become a complication leading
`to osteomyelitis and gangrene, for which surgery and even
`amputation may be required.
`
`DUs are caused by a reduction in the lumen of small blood
`vessels (obliterative vasculopathy as observed in the lung in
`PAH) that diminishes the blood flow to the fingers and toes.
`Endothelin, a pathogenic mediator, is implicated in vascular
`damage in SSc. In addition to causing vasoconstriction, en­
`dothelin also has direct deleterious effects, which cause fi­
`brosis, vascular hypertrophy, and inflammation.
`
`Idiopathic pulmonary fibrosis
`
`Pulmonary fibrosis is a progressive and usually fatal disease
`which may arise idiopathically or in association with underly­
`ing diseases like systemic sclerosis. It is estimated that there
`are around 60,000 patients worldwide with idiopathic pulmo­
`nary fibrosis (IPF).
`
`In IPF, fibrosis destroys both the structure and function of
`the respiratory system. Endothelin has direct pro-fibrotic and
`pro-inflammatory effects. Since endothelin concentrations
`are strongly elevated in interstitial lung disease, there is also
`evidence implicating endothelin in these diseases. For pa­
`tients with IPF outside of Japan, there are currently no ap­
`proved therapies available.
`
`Cerebral vasospasm as a consequence of aneurysmal
`subarachnoid hemorrhage
`
`Aneurysmal subarachnoid hemorrhage (aSAH) is a life­
`threatening condition affecting over 100,000 people in the
`EU, US and Japan every year. This condition occurs when
`the rupture of an aneurysm on the cerebral vessels leads
`to release of blood into the subarachnoid space of the brain.
`Endovascular coiling or microsurgical clipping is usually re­
`quired to stop the bleeding and prevent further episodes.
`
`Cerebral vasospasm following SAH causes the intracranial
`arteries to constrict thus diminishing blood flow to the brain.
`It is a significant predictor of poor outcome and the leading
`
`14
`
`WATSON LABORATORIES, INC. , IPR2017-01622, Ex. 1066, p. 14 of 111
`
`

`

`potentially treatable cause of mortality and morbidity in these
`patients. Vasospasm is unpredictable in nature and seen in
`over 67% of untreated patients with angiography at the time
`of maximum spasm, around the end of the first week. It
`becomes symptomatic in about half of these patients. Cur­
`rently, there is no effective treatment for the prevention and
`treatment of the severe complications following vasospasm.
`
`Endothelial system related oncology
`
`Endothelin receptors and endothelin are over-expressed on
`tumor cells and stromal cells in several tumor types, such
`as melanoma. They also contribute to invasion and metas­
`tasis. Actelion's endothelin antagonists are therefore being
`explored for application in cancer therapy.
`
`Renin angiotensin system
`
`The key enzyme renin is produced in the kidney, where it
`serves as gatekeeper to the biochemical cascade that ulti­
`mately results in production of the hormone angiotensin II.
`Under normal conditions, the kidney controls blood volume,
`blood pressure, and the electrolyte composition of body
`fluids, through the tightly regulated production of renin and
`therefore of angiotensin II.
`
`The overproduction of angiotensin II produces a range of del­
`eterious effects. Disorders of this system are a major fac­
`tor in high blood pressure, heart disease and kidney failure.
`Drugs that block the renin-angiote