ADHD Drugs Catch a Break

Drug company investors breathed a sigh of relief Thursday after a group of medical experts said the Food and Drug Administration shouldn't impose a black box warning on treatments for attention deficit hyperactivity disorder.

A black box warning is the FDA's strongest alert, and it usually leads to depressed sales for drugs that carry the warning. However, the panel of outside advisers said labels for ADHD drugs should clearly describe their potential for psychiatric and cardiovascular risks.

The advisory panel, which met for about 11 hours Wednesday, didn't take a formal vote. The consensus opinion contrasted with a vote last month of another FDA committee. That panel voted 8-7, with one abstention, to recommend a black box warning about cardiovascular risks for all but one ADHD drug on the market. The FDA isn't bound by its advisory panels' suggestions.

The latest committee comprised mostly experts in pediatrics, adolescent medicine and psychiatry. Most advisers at last month's panel specialize in risk management, epidemiology and medical administration.

Great and Small

The debate among the experts and within the FDA is being closely watched by some of the world's biggest companies, as well as by midsized and small drugmakers whose existing or experimental ADHD drugs are crucial to future sales and the growth of their stock.

The biggest ADHD companies -- Novartis (NVS), Johnson & Johnson (JNJ) and Eli Lilly (LLY) -- can absorb unfavorable news more easily than the other companies.

An across-the-board black box warning would have a more profound effect on the companies like Cephalon (CEPH), whose Sparlon is being reviewed today by another FDA panel. Cephalon's stock has been halted pending the panel's vote on the drug designed for children ages 6 to 17.

The company with the most to win or lose from the FDA's verdict is Shire PLC (SHPGY). Shire sells Adderall XR and Adderall, which are prescribed for children and adults. It also has agreements with two other companies for experimental ADHD medications.