Keryx is finding it hard to hang on to the huge gains its shares made last week after investors responded enthusiastically to positive data from a Phase III study of the phosphorous-clearing drug Zerenex. The biotech's shares ($KERX) had doubled on the late-stage results, but then went into a dive after an influential research firm concluded that Keryx might find it hard to secure New Chemical Entity status for the drug, the same problem that has dogged Amarin ($AMRN) for some time now.
As Adam Feuerstein at TheStreet reports, NCE status is absolutely essential for Keryx if it wants to fully capitalize on its late-stage success with Zerenex. Without the designation Keryx would face early generic competition for the drug, eating into its potential earnings. But IPD Analytics frets that the active ingredient in Zerenex may not be distinct enough from Otsuka's Ferriseltz, approved more than 15 years ago.
"It is unclear whether Zerenex will qualify for New Chemical Entity (NCE) exclusivity or a Patent Term Extension on one patent that covers Zerenex," IPD reports, according to Feuerstein. "In October 1997, FDA approved Otsuka's NDA for Ferriseltz (ferric ammonium citrate). It is possible that ferric citrate (the active ingredient in Zerenex) may be a salt of ferric ammonium citrate (the active ingredient in Ferriseltz). If FDA determines that ferric citrate is a salt of ferric ammonium citrate, then FDA could determine that Zerenex is not eligible to receive NCE exclusivity or a Patent Term Extension."
Feuerstein was one of the first analysts to predict that Amarin could have trouble landing NCE status for its fish oil drug Vascepa, approved last summer. The regulatory limbo has clouded Vascepa's launch, possibly spurring potential partners to shun a partnership. And with that prominent example in investors' minds, Keryx shares slid 22% on the bad buzz.
Zerenex is designed to rid kidney dialysis patients of a dangerous buildup of phosphorous. To make its pharmacoeconomic case to payers and help ease investors' concerns about the drug's commercial prospects, the company spotlighted secondary endpoint data which indicated a reduced need for IV iron and erythropoiesis-stimulating agents, or ESAs.
- here's the story from TheStreet