Monday, November 17, 2008 - 10:28 AM EST | Modified: Monday, November 17, 2008 - 10:42 AM
United Therapeutic hypertension drug trial disappoints
Washington Business Journal - by Vandana Sinha Staff Reporter
<TABLE style="FLOAT: right" cellSpacing=0 cellPadding=5 border=0><TBODY></TBODY></TABLE>
Related News
The Silver Spring company aimed to soften the pain with a new licensing agreement with Eli Lilly & Co. to develop and market its Cialis drug for the treatment of pulmonary hypertension in the United States -- a deal that company officials said would double its revenues if the drug is approved for that disease by federal regulators.
But investors weren’t convinced, driving United Therapeutics’ stock price down by 37 percent, from Friday’s closing price of $90.52 to $56.90 in early Monday morning trading.
The company reported that patients enrolled in its oral Remodulin drug trial didn’t benefit as expected from the tablet in a test that measured their walking distance over six minutes after a 16-week dosing period. Officials said the culprit was low dosage during the trial, and they will conduct further studies of the drug at higher dosing points.
“We paid the price all too frequently extracted from biotech companies that skip phase II studies,” said Martine Rothblatt, chairman and chief executive officer for United Therapeutics, during a conference call with analysts.
This outcome delays the prospects for the company’s oral version of its Remodulin drug. It already sells an intravenous version, and it has applied for federal approval to sell an inhaled version, which the company said is based on much more beneficial results and whose fate should be decided by April of next year.
But the company hopes to make up for that delay with another pulmonary hypertension drug that it is licensing from Eli Lilly in a $150 million deal. Under those deal terms, Eli Lilly will also buy $150 million worth of United Therapeutics shares.
United Therapeutics will pay Eli Lilly $150 million up front to gain U.S. rights to the drug candidate, a formulation of the erectile dysfunction Cialis drug that treats pulmonary hypertension, and also pay the larger pharmaceutical to manufacture the drug. The local company will also pay Eli Lilly, which keeps rights to the drug outside of the United States, 5 percent of that drug’s sales.
Eli Lilly has already submitted that drug for FDA approval, and if it is green-lighted, United Therapeutic officials said it foresees launching its inhaled drug and this Cialis formulation at the same time next year, the latter at the same price as the erectile dysfunction drug on the market.
“Today’s announcement portends a doubling of our current revenues. It portends a doubling of our market capitalization,” Rothblatt said.
But the company’s shares suffered the consequences of the failed trials. Trading volume more than doubled for United Therapeutics (NASDAQ: UTHR) stock, and its price plummeted to $15.65 below its former 52-week low of $72.55 soon after the opening bell.
“While any company is disappointed” from failed results, Rothblatt said, “the delay in oral [Remodulin] doesn’t even impede our entry into the market.”
United Therapeutics recently reported booking $205.6 million in revenue for the first nine months of this year, nearly all from Remodulin sales and up from $151 million in the same period last year. In that time frame, the company had also doubled its profits to $38.4 million this year from $17.9 million last year.
United Therapeutic hypertension drug trial disappoints
Washington Business Journal - by Vandana Sinha Staff Reporter
<TABLE style="FLOAT: right" cellSpacing=0 cellPadding=5 border=0><TBODY></TBODY></TABLE>
Related News
- Eli Lilly to pay California $5.6M
- United Therapeutics profit falls 15%
- States reach $62M settlement with Eli Lilly over Zyprexa
- COO: United Therapeutics' drug setback won't affect RTP
- Local chief execs dig deep to donate to campaigns
The Silver Spring company aimed to soften the pain with a new licensing agreement with Eli Lilly & Co. to develop and market its Cialis drug for the treatment of pulmonary hypertension in the United States -- a deal that company officials said would double its revenues if the drug is approved for that disease by federal regulators.
But investors weren’t convinced, driving United Therapeutics’ stock price down by 37 percent, from Friday’s closing price of $90.52 to $56.90 in early Monday morning trading.
The company reported that patients enrolled in its oral Remodulin drug trial didn’t benefit as expected from the tablet in a test that measured their walking distance over six minutes after a 16-week dosing period. Officials said the culprit was low dosage during the trial, and they will conduct further studies of the drug at higher dosing points.
“We paid the price all too frequently extracted from biotech companies that skip phase II studies,” said Martine Rothblatt, chairman and chief executive officer for United Therapeutics, during a conference call with analysts.
This outcome delays the prospects for the company’s oral version of its Remodulin drug. It already sells an intravenous version, and it has applied for federal approval to sell an inhaled version, which the company said is based on much more beneficial results and whose fate should be decided by April of next year.
But the company hopes to make up for that delay with another pulmonary hypertension drug that it is licensing from Eli Lilly in a $150 million deal. Under those deal terms, Eli Lilly will also buy $150 million worth of United Therapeutics shares.
United Therapeutics will pay Eli Lilly $150 million up front to gain U.S. rights to the drug candidate, a formulation of the erectile dysfunction Cialis drug that treats pulmonary hypertension, and also pay the larger pharmaceutical to manufacture the drug. The local company will also pay Eli Lilly, which keeps rights to the drug outside of the United States, 5 percent of that drug’s sales.
Eli Lilly has already submitted that drug for FDA approval, and if it is green-lighted, United Therapeutic officials said it foresees launching its inhaled drug and this Cialis formulation at the same time next year, the latter at the same price as the erectile dysfunction drug on the market.
“Today’s announcement portends a doubling of our current revenues. It portends a doubling of our market capitalization,” Rothblatt said.
But the company’s shares suffered the consequences of the failed trials. Trading volume more than doubled for United Therapeutics (NASDAQ: UTHR) stock, and its price plummeted to $15.65 below its former 52-week low of $72.55 soon after the opening bell.
“While any company is disappointed” from failed results, Rothblatt said, “the delay in oral [Remodulin] doesn’t even impede our entry into the market.”
United Therapeutics recently reported booking $205.6 million in revenue for the first nine months of this year, nearly all from Remodulin sales and up from $151 million in the same period last year. In that time frame, the company had also doubled its profits to $38.4 million this year from $17.9 million last year.
