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Catalyst Pharma: Orphan Drug Poseur, Profiteer

Stocks in this article: CPRX BMRN ALXN AEGR NPSP

Jacobus hopes to complete the 3,4-Dap study and submit the data to the FDA for approval in LEMS before Catalyst can do the same with Firdapse. If that happens, Jacobus will have orphan drug exclusivity in the U.S.

If Catalyst manages to submit Firdapse to FDA Firdapset and win approval, Laura Jacobus says they may seek an alternative strategy to get 3,4-Dap approved, perhaps in a disease related to LEMS, perhaps with a modified version of the drug.

Whatever happens, Laura Jacobus says she and her father don't want Catalyst to profit off the LEMS patients they've been helping for 20-plus years.

I reached out to Catalyst CEO Patrick McEnany for a response to the criticisms leveled by David and Laura Jacobus. In particular, I wanted to know why Catalyst chose to take on the development of Firdapse in LEMS given the free supply of 3,4-Dap available for so long.

McEnany responded via email:

Catalyst is seeking to develop this drug in order to make an FDA approved treatment available to all patients suffering from LEMS in a relatively short period of time. Catalyst recently acquired the development program and North American marketing rights for this drug. The development program was a phase III program that was well underway and was discussed with the FDA. Catalyst feels that we will be able to complete the development, seek FDA approval, and make an FDA approved therapy available to patients in a relatively short period of time, perhaps before 2016. Catalyst has observed that 3,4-Dap has been known to be effective in the treatment of LEMS for over 20 years and yet there is still no FDA approved version of this drug. Catalyst believes this is an opportunity to develop a new drug for an underserved population of patients.

Is there something different about Firdapse compared to the 3,4-Dap made by Jacobus that will benefit LEMS patients?

McEnany:

Firdapse contains the phosphate salt of 3,4-Dap. This pharmaceutical drug substance is more stable than the free base form of the 3,4-Dap that is available from Jacobus. Catalyst believes that Firdapse will have superior stability at room temperature which will provide patients with the assurance that their drug has the correct potency and purity throughout its shelf life, even when stored in a medicine cabinet or carried on the patients person for an extended period of time. Catalyst's Firdapse tablets, and its active ingredient, are produced on a commercial scale using validated processes and under all requirements of GMPs (this is a requirement for phase III clinical trial medications.

I really wanted to know what McEnany thought about being called a profiteer who doesn't care about the well being of LEMS patients. His response:

To state they Jacobus are giving it 3,4-Dap away for free doesn't fully describe the added burden placed on patients and their treating physicians and does not make it clear they are required under federal law to provide it for free under these circumstances. It is also stated above that the patient population is well served. First, because of the way in which the drug must be provided it is unlikely that all of the patients in need of the drug are in fact receiving it. The fact that Catalyst is able to recruit trial subjects in the United States in spite of Jacobus providing the drug for 20 years would seem to support this point. Second, the drug has not undergone the rigors of FDA review in which both the safety and efficacy of the drug would have to be demonstrated and specific dosing instructions provided. The current safety information and dosing instructions are likely insufficient, limiting the prescribing of this drug to a few experts in the use of the drug and the treatment of LEMS and is not suitable for broader use by the neuromuscular physician community. In short, these burdens limit access to patients that may need the drug, but do not have access to a physician willing to file an IND, or to become a clinical trial site. The best solution is clearly an FDA approved drug.

On that last point, Jacobus agrees, which is why the small drugmaker is in a race to get 3,4-Dap approved before Catalyst can do the same with Firdapse. This is a risk not widely recognized by investors who have bought Catalyst shares with the belief that it's an up-and-coming orphan drug developer.

-- Reported by Adam Feuerstein in Boston.

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