Avanir Pharmaceuticals Inc. reported positive results from one of two planned pivotal trials testing Neurodex in pseudobulbar affect, a somewhat rare tragedy/comedy neurological affliction that affects up to an estimated 1 million people in the U.S. each year.

"This will be one of two pivotal trials required for approval, and we've already met with the FDA on that," said Avanir President and CEO Gerald Yakatan. "With the p' values that we got, especially since this wasn't a gigantic trial, it was a very strong effect. For those patients, it's going to be an exciting thing."

Data from the trial were reported at the 13th annual symposium of ALS/MND in Melbourne, Australia. Pseudobulbar affect (PBA) is a symptom of neurodegenerative diseases in which those with the condition have sudden, inappropriate or excessive displays of tearfulness or laughter.

The trial examined Neurodex - an orally administered combination of dextromethorphan and quinidine sulfate - in patients with Lou Gehrig's disease who also have PBA. One hundred and forty patients received Neurodex capsules, dextromethorphan alone or quinidine sulfate alone, twice daily for four weeks.

The Neurodex arm showed statistically greater improvements in the primary endpoint - a change from baseline in a patient's score on the CNS-Lability Scale, a scale that measures the severity and frequency of a subject's episodes of pathological laughing and/or crying. In the intent-to-treat population, adjusted mean improvement for Neurodex was 1.8-fold greater than for the dextromethorphan arm (p=0.0013), and twofold greater than for the quinidine sulfate arm (p=0.0002).

The laughing/crying episode rate, a secondary endpoint, was significantly lower for patients treated with Neurodex than for either arm. Other secondary endpoints were the improvements in quality of life and quality of relationships.

Avanir, of San Diego, has initiated the second trial that evaluates PBA in multiple sclerosis patients. Avanir expects to bundle that trail, the Lou Gehrig's trial and an open-label safety study together into one package for regulatory submission. With an estimated completion time for the MS trial at the end of 2003, Avanir would like to submit its new drug application early in 2004.

"We've agreed with the FDA that, because [PBA] occurs in a number of diseases, if we study it in two of them, the FDA will approve [Neurodex] across the range," Yakatan told BioWorld Today. "[Approval] will be for PBA in neurological diseases."

The MS trial will be a three-month dosing study involving about the same number of patients. The cause of PBA has not been discovered, and therefore it is not known why Neurodex has benefit for patients, Yakatan said.

"Quite honestly, it was a serendipitous finding and the mechanism that either causes pseudobulbar affect or that helps the patients is unknown," he said, but added that perhaps the fact that Neurodex seems to help patients might further understanding of the disease.

Neurodex also is in a Phase II trial in neuropathic pain, evaluating the drug in diabetic neuropathy patients. Yakatan said he hopes the trial will be completed by spring. Beneath that, Avanir has an allergy/asthma program expected to produce an investigational new drug application in December and an inflammation program that could produce an IND six to nine months after that. The company's strategy is to always have a product in "every phase of development," Yakatan said.

On the market, it has Abreva docosanol 10 percent cream, the only cold sore product approved by the FDA for the over-the-counter market. The product is partnered with GlaxoSmithKline plc, of London.

"Abreva is terrific," Yakatan said. "It is by far the No. 1 product in the category. It is the No. 1 pharmacist-recommended-product in the category and I hope one day it will be the No. 1 product in the dentist category, as well."

Neurodex for PBA could become the No. 1 product in its category, since there are no products approved to treat PBA. That would be a nice achievement for Avanir, even if the market size isn't the largest.

"It's not the biggest, but it's a nice niche," Yakatan said. "It's maybe too small for big pharma but a big market for a company our size. We'll be first, if we get approved."

Avanir does not have a marketing partner for Neurodex, but as of right now it plans to sell the drug in the U.S. anyway.

"This is the kind of market you can cover with a relatively small sales force," he said. "That is our plan as we speak today, not to deal it off in the U.S. If we can cover it with a small sales force, this will be our entry into commercialization. Outside the U.S., of course, we will partner.

"I believe this is the right model for biotechnology companies," he added. "You just give money away, otherwise."

Avanir's stock (AMEX:AVN) rose 9 cents Tuesday, to close at $1.10.