Stallergenes beats Merck to market as FDA OKs its allergy pill

Stallergenes CEO Christian Chavy

France's Stallergenes won FDA approval to market the U.S.'s first oral immunotherapy for grass allergies, giving it a head start on rival Merck ($MRK), which expects to launch a similar product this year.

The drug, dubbed Oralair, is an under-the-tongue tablet that uses pollen extracts to gradually dull patients' allergic reactions to sweet vernal, orchard, perennial rye, timothy and Kentucky bluegrass. Stallergenes, along with U.S. marketing partner Greer Laboratories, hopes to contend with the commonplace shot regimens that have become the standard of care for severe allergy sufferers.

Meanwhile, Merck is awaiting final word from the FDA on its similar Grastek, designed to treat only timothy grass allergies. Like Oralair, Merck's pill won unanimous backing from a panel of agency advisers back in December, and the company has said it expects to win approval in the first half of this year, planning to launch the drug shortly thereafter.

But both companies may run into commercialization woes as they try to woo allergists and unseat tried-and-true injection therapies. Shots are inconvenient and require frequent visits to a clinic, but they're cheap and well-regarded by physicians and payers. Neither Merck nor Stallergenes has disclosed how much its treatment regimens will cost.

And beyond market-penetration concerns, Oralair's near-term prospects may fall victim to bad timing. Stallergenes says patients need to start taking the ascending-dose drug four months before the expected start of allergy season, meaning Oralair's peak opportunity is unlikely to come before next winter.

But Stallergenes is all in on its U.S. marketing plans for the drug, last month appointing a new CEO--former Actelion Pharmaceuticals ($ATLN) operations president Christian Chavy--and now leaning on Greer's experience selling allergy treatments to get Oralair off the ground. 

"This approval is a major milestone for Stallergenes," Chavy said in a statement. "... Thanks to Oralair, U.S. allergy specialists will now be able to offer a valuable treatment alternative to their patients with grass pollen-induced allergy, including those likely to refuse or prematurely discontinue subcutaneous immunotherapy."

Oralair's approval means a $10 million milestone payment from Greer to Stallergenes. The French company didn't disclose the size of its deal but said it's due up to $120 million in milestones and a cut of sales.

- read Stallergenes' announcement
- here's Greer's release