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NexMed Aims to Have Drug Approved by FDA, Chief Says
2008-09-12 16:43:38.720 GMT
By Kelly Riddell
Sept. 12 (Bloomberg) -- NexMed Inc., whose topical treatment for erectile dysfunction was rejected by the U.S. Food and Drug Administration in July, aims to have the drug approved in 13 months, Chief Executive Officer Vivian Liu said.
NexMed feels ``very strongly' that the results of additional studies can clear up safety questions raised when high doses of the drug caused cancer in mice, Liu said in an interview from the company's headquarters in East Windsor, New Jersey. Two subsequent two-year studies in mice and rats and more than 100 other animal studies found no cancer, the company said.
``We will be able to present them with the facts on Oct. 15 and hopefully reach consensus on what remaining work needs to be done in order for us to resubmit the filing,' Liu said.
``Assuming we can submit the amendment in the next six months, you're looking at starting a six-month review clock, so possibly we could be one year from approval.'
The outcome of the FDA meeting could trigger as much as $10 million in milestone payments in the next 13 months from Warner Chilcott Ltd., which has licensed the drug known as Vitaros, Liu said. The company agreed to pay NexMed up to $12.5 million in addition to their $500,000 upfront payment for the drug, Rochelle Fuhrmann, a spokeswoman for the Warner Chilcott said. No specific timeline or milestones for the payments has been publicly disclosed, she added.
Approval in Canada?
NexMed also expects approval for the drug in Canada at the end of this year or early in 2009, and is in talks with a potential partner there, Liu said, without giving details.
Sales of erectile dysfunction treatments are estimated at more than $3 billion a year worldwide, according to Denise Resnik, an analyst at JM Dutton & Associates.
NexMed has no products on the market and recently lost 86 percent of its value from Aug. 26 to Aug. 29 after another partner, Switzerland's Novartis AG, decided not to seek U.S. approval of NexMed's antifungal drug in August.
``It's been a rough market for us in the last few months,' Liu said. ``However, if you look at our cash on hand, potential milestone payments and our existing partnerships, we are undervalued. The potential for us is still there.'
Novartis's decision didn't affect other parts of its collaboration agreement with NexMed, including a $3.5 million milestone payment for obtaining a U.S. patent for the medicine, Liu said. The patent may be issued within 30 days, she said. Novartis spokeswoman Anna Frable had no immediate comment.
The milestone payment would provide NexMed with enough cash to finance operations for a year, Liu said. As of June 30, NexMed had $3.4 million in cash with monthly costs including fixed overhead of $525,000.
Another $3 million could come from Novartis if the company seeks approval for the antifungal medicine in Europe, where it is undergoing a separate study, Liu said.
NexMed fell 2 percent to 12 cents at 12:30 p.m. New York time in Nasdaq Stock Market composite trading. The stock has plunged 92 percent this year.
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