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AVNR News from BioWorld Today

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Shares of Avanir Pharmaceuticals Inc. nearly doubled as the company rapidly shifted into commercialization mode following FDA approval late Friday of Nuedexta (dextromethorphan hydrobromide and quinidine sulfate), the first and only FDA-approved treatment for pseudobulbar affect (PBA).

Avanir stock (NASDAQ:AVNR) was up 98.4 percent at close Monday, adding $2.38 to end at $4.80 in very heavy trading: Volume was 55.3 million shares, compared to the three-month average of 2.8 million.

PBA, which occurs in neurological conditions such as amyotrophic lateral sclerosis (ALS) and multiple sclerosis (MS), is characterized by involuntary, sudden and frequent episodes of laughing or crying. The product might also be valuable to stroke patients and returning military personnel who have suffered traumatic brain injuries, said Keith Katkin, president and CEO of the Aliso Viejo, Calif.- based biotech.

Katkin said today that the company is "able to hit the ground running" with a sales team trained and ready. He expects to launch Nuedexta in the first calendar quarter of 2011.

Nuedexta went by the proposed trade name Zenvia until July when, the company said, the FDA would not accept the name for marketing use. Avanir submitted additional brand names to the FDA for consideration and the new name was not announced until FDA approval on Friday.

By any name, analysts were bullish about Avanir's future. Analyst Ritu Baral of Canaccord Genuity gave the company a "buy" rating and raised her price target from $9 to $10. She said she expected the company to "drive strong PBA awareness campaigns and continue strong clinician and patient outreach. We predict strong launch in Q1/11."

Baral also said that Nuedexta's label is "very clean, allowing access to a broad patient population. Nuedexta has no REMS [risk evaluation and mitigation strategies] or black box warning."

Jefferies & Co. analysts Andrew Fein and Hugo Ong agreed, noting that "To add icing to the cake, there is no black-box warning on Nuedexta's label, which gives Nuedexta no restrictions in its target patient population. While the label specifically highlights the effectiveness of the drug in multiple sclerosis and ALS patients, we believe off-label usage in a broader patient pool is likely."

They also gave Avanir a "buy" rating and raised their price target from price target from $10 to $15.

Meanwhile Avanir's Katkin said that the company had already hired seven specialty sales people two months ago. They have targeted about 15,000 neurologists, geriatric psychiatrists, geriatricians and physician physical medicine and rehabilitation specialists and will help educate an initial 68 more salespersons who have already accepted conditional offers.

He said the company is moving forward with plans for packaging, distribution and marketing and will unveil Nuedexta in early November at the American Academy of Physical Medicine and Rehabilitation Annual Assembly & Technical Exhibition in Seattle and the American Society of Consultant Pharmacists Annual Meeting and Exhibition in Orlando.

As of the end of September, the company had cash on hand of more than $39.4 million, a position that Katkin said, "provides enough cash to fund the initial launch of Nuedexta." The marketing plan calls for the company to "cast a very wide net" at launch, he explained. Each of the 75 sales reps will get target lists of 200 physicians – neurologists, geriatric psychiatrists, geriatricians, physician physical medicine and rehabilitation specialists (PM&Rs) – for a total of about 15,000 in the U.S.

Katkin added that Avanir considers expansion of Nuedexta to Europe an "important focus." He said that a number of companies contacted Avanir prior to FDA approval and he expects to see interest increase.

Katkin said that he expects Nuedexta to sell to patients for between $3,000 and $5,000 per year, with a final price to be determined between late November and mid-December.

Nuedexta studies were performed in ALS and MS patients. The primary outcome measure, laughing and crying episodes, was significantly lower in the Nuedexta arm compared to placebo, the company said. The secondary outcome measure, the Center for Neurologic Studies Lability Scale (CNS-LS), demonstrated a significantly greater mean decrease in CNS-LS score from baseline for the Nuedexta arm compared to placebo.

"This FDA approval represents a significant step forward for people who live with the debilitating effects of PBA," said Nicholas LaRocca, vice president of healthcare delivery and policy research at the National MS Society. "For people who experience unexplained bouts of inappropriate laughing or crying, this new therapy has the potential to substantially help both them and their families."

Patients with PBA "frequently experience embarrassment due to their unpredictable emotional outbursts, leading to disruption of their interpersonal relationships and social isolation," explained Erik P. Pioro, director of the Section for ALS and Related Disorders at the Cleveland Clinic, and an investigator in clinical studies evaluating Nuedexta.

"As a physician who has cared for many patients with PBA, I am pleased that there is now a safe and effective treatment option for PBA that may help these patients regain more control over their daily lives and live with dignity," Pioro said.