Prosecutors have revealed Kolon Life Science had to change contract manufacturing organization (CMO) for Invossa-K, gene therapy for knee osteoarthritis, from Wuxi to Lonza.
The revelation came when the Seoul Central District Court held the second trial on Kolon Life Science CEO Lee Woo-sok and company executives on Wednesday. The company initially wanted Wuxi to manufacture Invossa samples for a phase-3 trial in the U.S. but failed to do so even after seven times of production trials.
The court heard the testimony of an employee of the Financial Supervisory Service (FSS) who reviewed the securities registration statement of Kolon TissueGene submitted to the regulator for Kosdaq listing in 2017.
During the testimony, the prosecution said Kolon TissueGene tried to produce Invossa for a phase-3 trial from Wuxi, which had manufactured drug samples for phase-1 and phase-2 studies of Invossa. However, the company failed to do so even after seven times of trials, and could not find the reason for the failure, either, the prosecution added.
Kolon TissueGene shifted the CMO to Lonza in March 2017.
When producing drug samples for a phase-3 trial, the company has to prove the drug’s equivalence through a comparative equivalence test with the sample of the phase-2 study, the prosecution said. If a company changes CMO for a phase-3 study, however, it gets difficult to prove the equivalence, which was why it took three years for the company to resume the phase-3 trial on Invossa in the U.S. after getting the nod for the study, the prosecution added.
The change of the CMO led Mitsubishi Tanabe to cancel the licensing deal with Kolon Life Science.
In November 2016, Mitsubishi Tanabe clinched a 500 billion won ($407.3 million) deal with Kolon to develop Invossa in Japan. However, the Japanese company demanded the cancellation of the agreement, saying Kolon did not discuss changing of the CMO for the phase-3 study of Invossa in advance.
Mitsubishi Tanabe also said Kolon did not share the FDA’s clinical hold letter on the phase-3 trial, either.
During the trial, the prosecution asked the FSS official whether he was aware of such issues when reviewing the registration statement of Kolon TissueGene and whether he felt the need to note those issues in the registration statement.
The official replied that he did not know about the problem of the drug sample production, the change of the CMO, or Kolon’s receiving of the clinical hold letter from the FDA. “If the company had a problem in manufacturing drug samples and changed the CMO, it had to disclose them as investment risk factors,” he said.