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
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

FDA Ends October With Drug Approvals, Rejection

Updated throughout, including information on the FDA rejection of Biodel's fast-acting insulin.

BOSTON (TheStreet) -- U.S. regulators ended October with two drug approvals and a rejection, clearing an antibiotic from Forest Labs (FRX) and a first-time treatment for a neurological disorder developed by Avanir Pharmaceuticals (AVNR) but rejecting a fast-acting insulin from Biodel (BIOD).

October was a busy but tough month for new drug approvals at FDA. Regulators rejected eight new drugs, including two different diabetes drugs from Amylin Pharmaceuticals (AMLN) and Biodel, and weight-loss drugs from Arena Pharmaceuticals (ARNA) and Vivus (VVUS), respectively.

FDA approved four drugs, the two mentioned above plus drugs from Questcor Pharmaceuticals (QCOR) and Alkermes (ALKS).

On Monday, FDA rejected Biodel's Linjeta, telling the company that data submitted was not sufficient for approval and that two new clinical studies, one each in Type 1 and Type 2 diabetics, would be necessary if regulators were to consider the drug for approval again. FDA is also seeking more information from Biodel about the manufacturing of Linjeta.

Biodel shares were down more than 50% to $1.68 in Monday pre-market trading.

The Forest Labs injectable antibiotic Teflaro approved Friday will be used to treat patients with pneumonia and bacterial skin infections, including methicillin-resistant Staphylococcus aureu, or MRSA.

"These are serious and potentially life-threatening infections for which new treatment options are needed. FDA is committed to facilitating new antibiotic drug development," said Edward Cox, the director of FDA's Office of Antimicrobial Products, in a statement.

Forest expects to launch Teflaro in January 2011.

The Avanir drug, Nuedexta, was approved as the first treatment for pseudobulbar affect (PBA) a neurological condition in which patients suffer from uncontrollable outbursts of laughing or crying. Most patients who suffer from PBA are also diagnosed with other neurological disorders like multiple sclerosis or Lou Gehrig's disease.

Avanir won Nuedexta's approval after a lengthy delay brought on by FDA concerns that the drug coud cause serious heart rhythm disruptions. Avanir reformulated Neudexta at a lower dose and conducted another safety study to assuage FDA concerns.

FDA approved Nuedexta without a so-called black box warning but the label does warn doctors to avoid using the drug in certain patients with heart problems and to monitor patients initially to guard against arrhythmias. The FDA did not release a statement regarding Nuedexta's approval.

Canaccord Genuity analyst Ritu Baral forecasts Nuedexta peak sales of $350 million in the U.S. and another $300 million in Europe, if the drug is approved there in several years. She has a buy rating and a $9 price target on Avanir.

Monday, Jefferies raised its price target on Avanir to $15, citing the "scarcity value" of approved neurological drugs like Nuedexta as a potential inducement for a takeover.

Avanir bears who were burned Friday by Nuedexta's approval also contend that Avanir exaggerates Nuedexta's commercial potential, believing the drug will only garner about $50 million in U.S sales.

Avanir shares closed Friday at $2.42 but doubled in price to $5 in the after-hours session upon news of Nuedexta's approval.

Other upcoming FDA drug approval decisions:

Nov. 4: Cadence Pharmaceuticals' (CADX) Ofirmev for fever and pain indications.

Nov. 18: Amgen's (AMGN) Prolia to treat bone complications due to cancer therapy.

--Written by Adam Feuerstein in Boston.



>To contact the writer of this article, click here: Adam Feuerstein.

>To follow the writer on Twitter, go to http://twitter.com/adamfeuerstein.

>To submit a news tip, send an email to: tips@thestreet.com.

Adam Feuerstein writes regularly for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, 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
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
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!
DOW 16,979.13 +59.54 0.35%
S&P 500 1,986.51 +4.91 0.25%
NASDAQ 4,526.4820 -1.0320 -0.02%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

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