Transcept Pharma faces more hurdles to gain approval of sleep drug

Will three times be a charm for Transcept Pharmaceuticals? The developer of neuroscience drugs ($TSPT) revealed late last night details of an expected complete response letter from the FDA for the firm's second attempt at approval of a middle-of-the-night insomnia drug called Intermezzo.

The FDA has again declined to approve the drug--which is supposed to be taken by those who wake up in the middle of the night and have trouble falling back asleep--amid concerns over potential impairment of people who get behind the wheel after taking the treatment. The agency, which has previously raised the driver impairment concern, apparently wasn't satisfied with the data from a driver study the company conducted after the first denial.

Transcept said it plans to meet with regulators to discuss next steps, which might include another driving study. Yet even a delayed approval of the drug (zolpidem tartrate sublingual tablet)--which uses the same ingredient as Sanofi's Ambien--could be costly to the developer due the terms of its partnership with Purdue Pharma. Purdue no longer has to pay Transcept a $30 million fee for approval of the treatment if the marketing green light comes after Sept. 23, according to the two firms' deal.

Yet Transcept said it had about $59.6 million in cash as of June 30, and that should be enough to fuel its operation for a while based on its $1.2 million monthly burn rate.

- here's Transcept's release
- see the coverage from RTTNews