Washington Editor

Another FDA delay on Thelin (sitaxsentan) caused investors to unload shares in Encysive Pharmaceuticals Inc. on Tuesday.

The stock (NASDAQ:ENCY) plunged by 40.3 percent, falling $2.49 to close at $3.69 in heavier-than-usual trading. The Houston company acknowledged a second approvable letter after Monday's market close.

Two underlying reasons prompted the sell-off, said Phil Nadeau, an analyst with New York-based Cowen and Co. LLC. He pointed to "a concern that Encysive won't be able to get through this issue without additional studies," and secondly, he told BioWorld Today, the FDA's action represents yet another holdup for the drug, which has been under review for pulmonary arterial hypertension.

The agency issued an initial approvable letter in the spring to raise concerns and the possibility of additional clinical work. Company officials declined to specify the FDA's concerns or set a timeline as to when they might be resolved, and investors reacted swiftly. Its stock lost half its value that day, closing at $4.60. (See BioWorld Today, March 28, 2006.)

Of the items raised in the first approvable letter, one "substantive" issue remains unresolved, President and CEO Bruce Given said in a conference call. Though he declined to specify the nature of the matter for competitive reasons, he said Encysive would work toward resolution "in the fastest possible way."

"We need to get over that hump to get approval," Given said, adding that "the door is still open for us" to continue a dialogue with the agency on a single remaining point of concern.

But that matter remains a question mark for outsiders. "Everyone has theories about what it could be," Nadeau said, guessing that it could be a safety-related matter given the FDA's overall bent toward precaution of late, "but no one outside of Encysive really knows for sure."

Importantly, the agency indicated that the remaining item in question is a "judgment call," Given said, and has expressed an openness to consider new arguments to address it. "I think that they recognize that there's merit in our point of view, and we certainly find merit in their point of view," he added. "It's just a matter of working through this final item."

He declined to say whether additional clinical trials would be necessary, although he added that he continues "to feel good" about avoiding such work. Notably, though, the agency again offered additional clinical trials as an alternative.

The FDA also provided constructive recommendations on the company's risk management plan, making "recommended enhancements" to its initial proposal, Given said. He added that the latest approvable letter should not impact the drug's review in Europe, where a regulatory decision is expected this fall.

Nadeau projected European revenue reaching $40 million next year and climbing to $135 million by 2010. In the U.S., he is forecasting a 2008 launch and revenue reaching $100 million by 2010.

Encysive's new drug application includes data from two randomized, placebo-controlled Phase III studies called STRIDE-1 and STRIDE-2. Data from the first demonstrated Thelin's ability to produce an increased six-minute walk distance of 65 meters (p=0.0002) vs. 34 meters (p=0.0005) in the intent-to-treat patient group. Findings from the second showed Thelin met its primary objective of improved six-minute walk with a statistically significant increase of 31.4 meters compared to placebo (p=0.03).

If approved, the drug would compete in a PAH market that already includes Tracleer (bosentan, Actelion Ltd.) and Revatio (sildenafil, Pfizer Inc.).

Also in late-stage development for PAH is ambrisentan (Myogen Inc.), which could be on the market in the second half of next year.

Encysive nonetheless remains committed to staying the course, with Given noting that the company has no plans to cut any of its staff in the face of this latest delay, including its recently hired sales force. "Our faith in Thelin is undiminished," he concluded.

FDA Clears New Enzyme Therapy

The FDA approved the first treatment for Hunter syndrome, Elaprase (idursulfase), an enzyme replacement therapy.

The rare, life-threatening genetic condition, which also is known as mucopolysaccharidosis II (MPS II), results from insufficient levels of the lysosomal enzyme iduronate-2-sulfatase. Without this enzyme, cellular waste products accumulate in tissues and organs, which then begin to malfunction.

To correct that deficiency, Shire plc is bringing to market Elaprase, a purified form of the lysosomal enzyme iduronate-2-sulfatase that is produced by recombinant DNA technology in a human cell line. The Basingstoke, UK-based company expects to launch it in the U.S. within the next 30 days.

The product is manufactured by Shire Human Genetic Therapies Inc., the company's Cambridge, Mass.-based division that primarily comprises the former Transkaryotic Therapies Inc. Shire acquired that company last year in a deal estimated at $1.6 billion, and has full rights to Elaprase as a result. (See BioWorld Today, April 22, 2005.)

The approval was based largely on Phase II/III data showing that weekly infusions of the enzyme replacement provided patients an extra 35 meters of distance walked in six minutes, on average, compared to those treated with placebo. Findings from the yearlong, randomized study were reported just over a year ago. (See BioWorld Today, June 21, 2005.)

The company said there are about 2,000 Hunter syndrome patients worldwide in areas where reimbursement may be possible, and estimates that the U.S. accounts for about a quarter of the global market. A European regulatory decision is expected at the end of this year.

Oncaspar Gets Label Expansion

The FDA approved a supplemental biologics license application for Oncaspar (pegaspargase) to include treating children and adults with newly diagnosed acute lymphoblastic leukemia (ALL) as part of a multiple-drug chemotherapy regimen.

Enzon Pharmaceuticals Inc., of Bridgewater, N.J., markets the product.

It has been approved since 1994, but for more restrictive use in acute lymphoblastic leukemia patients who were unable to receive Elspar (L-asparaginase, Merck and Co. Inc.) because of allergies to it.

Oncaspar is a PEG-enhanced version of the naturally occurring enzyme L-asparaginase, an enzyme that depletes the amino acid asparagine that certain leukemic cells depend upon for survival. Its dosing regimen allows for administration every 14 days, compared to twice-weekly dosing for unmodified L-asparaginase.

The expanded label for Oncaspar is the result of findings showing that it could be safely and effectively substituted for Elspar as part of a multidrug cancer regimen.