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Biotech Stock Mailbag: Chelsea's FDA Panel, Ariad's Future, Bio-Bubble Update

Stocks in this article: CHTP ARIA AMRN CELG

But... the reduction in falls attributed to Northera was not statistically significant. Looking at this graph, it seems impossible that fall reduction wasn't stat sig. The problem, explains Oliveto, is the data on falls were not normally distributed across patients in the study. Simply put, about half of the patients in Study 306B never experienced a fall. Some of the remaining patients experienced a relatively small number of falls, while still other patients fell a lot.

Overall, placebo patients suffered many more cumulative falls than Northera patients, but when you apply traditional biotech statistics to the data, it comes back not statistically significant.

This will be more discussion fodder for the Jan. 14 panel. Oliveto believes that panel members will use their common sense and reach the conclusion that Northera, by reducing dizziness, will also help prevent falls. I agree with him. This is a case where bio-stats don't add value.

One more issue: Durability, or lack thereof. Go back and look at the first graph. The primary endpoints of Study 301 and Study 306B assess dizziness after one week of treatment. A knock on Northera and a reason FDA rejected the drug last year was the absence of data demonstrating an extended benefit for NOH patients.

Chelsea still lacks Northera durability data although Oliveto says FDA has signaled a willingness to approve based on 1-week benefit with a commitment to conduct a longer-term post-marketing study. Chelsea has designed another study which will enroll 450 NOH patients and assess a dizziness reduction endpoint at 12 weeks. The study will also look at fall reduction.

Oliveto said this "durability" study will begin enrolling patients before the end of the year as a demonstration of commitment to the FDA.

Chelsea anticipates fielding questions about durability during the Jan. 14 panel and will respond with data from Study 306B showing a positive trend in dizziness reduction favoring Northera extended out to 8 weeks. This trend is not statistically significant, however.

No one said Chelsea is going to have an easy time at the Northera FDA panel. Like in February 2012, the company will need to present its data well and be prepared to answer some tough questions. My confidence in a positive panel vote lies in the totality of the Northera data which makes a risk-benefit argument. I should mention Northera's safety data across all the studies is excellent.

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