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

More Trouble for Vanda's Sleep Disorder Drug

Stocks in this article: VNDA

As this story was being published, Vanda announced a follow-on stock offering of 4 million shares.

WASHINGTON, DC ( TheStreet) -- In June, I uncovered a long list of deficiencies and shortcuts taken by Vanda Pharmaceuticals (VNDA) in the development of tasimelteon, a melatonin receptor agonist, for the treatment of a rare sleep-pattern disorder that affects blind people.

My conclusion: The odds of FDA approving Vanda's tasimelteon for non-24 sleep-wake disorder were exceedingly small.

I based my last analysis primarily on the larger of two phase III studies Vanda conducted on tasimelteon -- the so-called "SET" study. Vanda's second phase III study -- known as "RESET -- is equally troublesome.

Let's take a closer look.

RESET was a randomized withdrawal study, meaning all patients diagnosed with non-24 entered first into a run-in stage in which they were treated with daily tasimelteon for three months. After three months of receiving tasimelteon, patients were randomized to one of two groups: 1) continued tasimelteon treatment for two months; or 2) a switch to placebo for two months.

At the end of the two-month withdrawal phase, patients were measured for response, defined as maintenance of entrainment, or adherence, to a normal 24-hour circadian rhythm.

Vanda declared victory in the RESET study, claiming 90 percent of tasimelteon-treated patients maintained entrainment of their circadian rhythm after two months compared to 20 percent of placebo-treated patients. The difference in entrainment maintenance was statistically significant.

Here's a chart describing the RESET primary endpoint, taken from a poster presented at the Endocrine Society (ENDO) meeting in June.

Was the tasimelteon benefit clinically meaningful or relevant at all for getting the drug approved? I don't believe so.

Vanda chose to measure maintenance of entrainment at a fixed and arbitrary point in time, defined in RESET as two months. A non-24 patient was deemed a responder in RESET if he/she maintained entrainment at two months.

Of the 10 patients treated with tasimelteon, 9 maintained entrainment after two months. Ten patients were treated with placebo but only two maintained entrainment for two months. I'll address the issue of only having 20 patients to analyze in what is supposed to a pivotal, phase III study later.

Why is this claimed success irrelevant? Because it doesn't matter if non-24 patients maintain entrainment for two months if they continue to suffer from sleep problems.

1 of 2

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 16,380.41 +263.17 1.63%
S&P 500 1,886.76 +24.00 1.29%
NASDAQ 4,258.4380 +41.0480 0.97%

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