This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Depomed Bear Case: FDA Panel Will Ding Serada

(Editor's note: The following column from contributor Aafia Chaudhry explains the bear case against Depomed and its "hot flash" drug Serada. All stocks have two sides, so read Chaudhry's column as a counter-argument to the Depomed bull thesis published by Jason Napodano, Zacks analyst and PropThink contributor on Jan. 30.)

NEW YORK ( TheStreet) -- I believe the FDA advisory panel will vote against Depomed's (DEPO - Get Report) Serada on March 4. The negative vote will subsequently convince FDA to reject Depomed's application for Serada on or before the decision date of May 31.

Serada is a proprietary, extended-release formulation of gabapentin, an analogue of the chemical transmitter GABA that is used to treat seizures and neuropathic pain. The role of gabapentin to treat vasomotor symptoms (VMS) of menopause -- more commonly known as hot flashes -- is tenuous at best. The results of Depomed's phase III study program for Serada do not support the drug's efficacy in this indication.

Depomed conducted two phase III studies of Serada in women with VMS, or hot flashes. BREEZE-1 and BREEZE-2 were randomized, double-blind, placebo-controlled studies of approximately 540 patients per study, receiving treatment with Serada 1200 mg or 1800 mg daily or placebo.

Total treatment duration in BREEZE-1 was six months, with primary efficacy endpoints assessed after four and 12 weeks of stable therapy. Persistence of efficacy was assessed at six months as a secondary endpoint. Treatment duration in BREEZE-2 was three months, also with assessment of efficacy at four and 12 weeks. Both BREEZE-1 and BREEZE-2 utilized primary endpoints measuring the mean change in frequency and severity of VMS from baseline to weeks four and 12.

Depomed reported the outcomes of the studies in 2009. Both BREEZE-1 and BREEZE-2 failed to meet any of the primary endpoints with statistical significance. There were many issues with the data reported, raising questions about the true clinical benefit of Serada in the VMS setting.

In BREEZE-1, 36% of patients receiving treatment at 1200 mg, and 30% of those receiving 1800 mg failed to complete the study. These are very high and concerning dropout rates for any clinical trial. Some menopausal women can experience VMS for years, so any treatment needs to be well tolerated, safe, and demonstrate persistent benefit.

Serada did not demonstrate persistence of effect for even 12 weeks let alone 24 weeks. The 24-week data were never reported fully reported but will hopefully surface in March at the FDA panel.

At best, the results of BREEZE-1 and BREEZE-2 seem to indicate treatment with Serada is associated with approximately one less hot flash per day compared with placebo treatment, and only for a short period of time. Given the 50% placebo response rate often seen in VMS trials, Serada's "benefit" seems clinically meaningless and hard to justify given gabapentin's adverse event profile. I expect the FDA's own analysis of the BREEZE-1 and BREEZE-2 data will support my bearish position on Serada.

Depomed bulls argue in favor of Serada's VMS benefit only by manipulating the statistics of the BREEZE-1 and BREEZE-2 trials. Well, as the old saying goes, "If you torture the data long enough, it will confess to anything." Thankfully, FDA reviewers are usually skeptical when presented with a plethora of post-hoc "statistically significant" results.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
DEPO $22.67 3.66%
AAPL $124.08 -0.13%
FB $83.78 0.93%
GOOG $551.20 -0.72%
TSLA $185.90 -2.40%

Markets

DOW 17,712.66 +34.43 0.19%
S&P 500 2,061.02 +4.87 0.24%
NASDAQ 4,891.2190 +27.8570 0.57%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs