SkyePharma slumps on US delay for Flutiform

UK drugmaker SkyePharma saw its share price slump 11% to 101 pence after the US Food and Drug Administration said additional data would be required with respect to the company's New Drug Application for its lead development product, Flutiform (fluticasone propionate/formoterol fumarate), an investigational treatment for persistent asthma in patients 12 years of age and older. The stock has already fallen over 40% in the past three months.

As previously announced in June, the FDA gave preliminary notice of some potential review issues which it had identified in its preliminary evaluation of the NDA, which had been accepted for substantive review.  As a result, the company announced that it appeared likely that some additional clinical work may be required to provide more data on dosing and that a meeting was being sought with the FDA with a view to agreeing how the potential review issues may be addressed.

Singer Capital Markets analyst Shawn Manning, reported by EasyBourse, said Flutiform could do brisk business once it does get to market. Products similar to Flutiform generate sales of about $29 billion a year, and he estimates the drug could sell between $300 million and $400 million annually. However, other drug makers are working on newer products too, notably US major Schering-Plough and Switzerland's Novartis and are not far from getting their regulatory submissions in. When it does get to market, Flutiform might also have to compete with cheaper generic versions of some of today's blockbuster asthma drugs, like UK giant GlaxoSmithKline's Advair (fluticasone and salmeterol).

A meeting has now been held with the FDA and it has been confirmed that additional clinical work will be required to provide more data on dosing.  The board believes that it is unlikely that Flutiform will, therefore, be approved in the US before the second half of 2011.  In the meantime the review of the NDA is continuing.

Under the current license agreement Abbott is responsible for paying for additional clinical or other trials required by the FDA, and is entitled to recoup such costs out of up to 2% of any approval or post-approval milestones and royalties.

Ken Cunningham, chief executive of SkyePharma, said: "We now have greater clarity from the FDA on its approach to our filing and we are working to address these issues as soon as possible. Flutiform remains on track in Europe and Japan, and we remain confident that, once approved and launched in its various markets, Flutiform will be a successful product for SkyePharma in terms of both revenues and cash flows."