said Monday that it received Food and Drug Administration approval for Nuvigil, an updated version of its Provigil drug for several sleep disorders.
Nuvigil's approval had been expected by Wall Street even though the drug had been subject to a series of regulatory delays, relating primarily to how side effects will be described on the drug's label. Cephalon's Nuvigil application to the FDA was filed in March 2005.
Although most companies getting approval for a long-delayed drug would try to get the product on the market immediately, Cephalon is taking a relaxed approach. "The company currently plans a commercial launch of Nuvigil once additional clinical data has been amassed," Cephalon said. In May, Frank Baldino Jr., the chairman and CEO, said Cephalon wouldn't market Nuvigil this year.
Cephalon can afford to employ this strategy because it doesn't want to cannibalize sales of Provigil, its biggest drug, which accounted for $201.3 million of the total $437 million in sales for the most recent quarter.
Thanks to a series of deals in late 2005 and early 2006 with four generic-drugmakers, Provigil won't be hit by generic competition until the fall of 2011 or perhaps the spring of 2012. If any of these four companies had successfully challenged Provigil's patent, the market might have been flooded with cheap copies last year.
That gives Cephalon time to switch patients from the older drug to its chemical cousin. It also enables Cephalon to spend money on researching other uses of Nuvigil, whose U.S. patent remains in force until 2023.
Potential treatments include bipolar depression, excessive sleepiness in medical conditions such as Parkinson's disease, and fatigue in patients who are being treated for cancer, the company said.
"The approval of Nuvigil allows us to preserve our current leadership position in the area of wakefulness," Baldino said in a prepared statement. "More importantly, we now have a longer-term opportunity to further characterize the utility of this compound beyond wakefulness."
Nuvigil was cleared for three conditions of excessive sleepiness -- narcolepsy, obstructive sleep apnea/hypopnea syndrome and shift-work disorder, in which people with constantly changing work hours can't get adequate sleep. Labels for Nuvigil and Provigil will contain warnings about a rare, and sometimes fatal, skin rash caused Stevens-Johnson syndrome, a reaction to some drugs.
In premarket trading, Cephalon was up 97 cents, or 1.2%, to $84.83.