IRVINGTON, NY ( TheStreet) --Congratulations Mela Sciences ( MELA). The campaign of legal and political pressure paid off. The U.S. Food and Drug Administration reversed course and granted conditional approval for the company's MelaFind skin cancer detection device. Mela shares were up $1.92, or 60%, to $5.07 in Monday trading. Critics like myself who doubted this day would ever come, especially without a new pre-approval study, were wrong. Well, sort of wrong, since Mela Sciences can't begin selling MelaFind until it reaches agreement with FDA to resolve a list of open issues in the "approvable" letter. These include reaching final agreement on the device's final labeling, a user guide, the details of a training program for doctors and the design of a post-approval clinical trial. On a Monday conference call, Mela CEO Joe Gulfo sounded uncertain about when FDA would actually approve MelaFind and was careful to downplay launch expectations if and when the company does begin selling the device. Gulfo said final negotiations with FDA on the outstanding MelaFind issues were substantially complete but then he acknowledged that these discussions with the agency were still going "back and forth" and therefore not complete. He declined to offer a guess on when FDA would issue a final approval for MelaFid but he did say the company hopes to start selling the device in the first quarter of 2012. Before Mela launches MelaFind, the company is also going to conduct additional "beta tests" with doctors to make technical and usability improvements to the device Gulfo said. When MelaFind is finally launched in the U.S., sales will be restricted to dermatologists who must first complete a training course on the device's use. Mela initially hoped to market MelaFind more broadly to general practitioners. MelaFind's label describing how the device should be used is four paragraphs long and includes various restrictions and warnings on the types of lesions to be tested and how to interpret results. Gulfo, on Monday's call, acknowledged the MelaFind label is longer and more complicated than the company had envisioned when it submitted the device for FDA approval.
It will take a year after launch, carefully selling MelaFind in select markets, before the company knows how best to market the device, Gulfo added. The conditional approval of MelaFind is no doubt a positive development for Mela, but the company's bigger challenge now will be selling the device in the face of continued skepticism over its accuracy and clinical utility. In so many ways, Mela's story mimics Cyberonics' ( CYBX) quixotic efforts in 2004 to expand use of its Vagus Nerve Stimulation (VNS) device into severe depression. An FDA advisory panel voted to recommend approval of the VNS medical device for patients with severe depression despite controversial and largely mixed clinical data. Despite the positive vote, FDA rejected Cyberonics' application, after which the company applied significant legal and political pressure on the agency to change its mind. FDA ultimately did relent and approve the VNS device for depression, but Cyberonics' commercial efforts came up well short because doctors and insurance companies didn't believe VNS benefited depressed patients. Can Mela succeed where Cyberonics failed? The jury is still out. --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: email@example.com.