Sometimes it can pay off when you take a never-say-die approach to drug development. Today's winner for sticking it out in the face of back-to-back rejections at the FDA: Transcept Pharmaceuticals, which saw its shares ($TSPT) soar more than 30% on the news that the FDA had accepted its NDA on the sleep drug Intermezzo as a Class 1 response, setting a quick November 27 PDUFA deadline on a final decision for the drug.
Transcept, of course, won a second complete response letter from the FDA last July as regulators continued to fret over the sleep drug's lingering effects as people who used the drug in the middle of the night got up and climbed behind the wheel of a car. But Point Richmond, CA-based Transcept apparently caught a break mid-September when regulators agreed to settle for an adjustment on dosing based on gender and built in some added safety with new timing instructions for patients. That move touched off a big rally for its shares.
Transcept, though, has already passed a key deadline on the drug. When the biotech laid out its original, $145 million partnership with Purdue, it lined up a $30 million milestone provided an approval had come through by June 30, 2010. Every month it was delayed past that point, the milestone dwindled by $2 million. The last of that money apparently vanished at the end of September.
Not all analysts are excited about the commercial prospects of a new sleep drug in an already crowded marketplace. For this morning, though, Transcept's chances of an approval appear fairly positive despite the earlier rejections. Investors seem willing to bet on that catalyst alone today.
- here's the Transcept release