Forest Laboratories Inc. (FRX) is getting ready to face an FDA panel that will review the company's injectable antibiotic, Ceftaroline, for two indications on September 7.
The company is seeking approval for Ceftaroline in the treatment of adults with CABP (community-acquired bacterial pneumonia), and treatment of cSSSI (complicated skin and skin structure infections).
Ceftaroline is a member of the cephalosporin class of antibiotics, the most frequently prescribed class of antibiotics in the world. Forest Labs obtained the worldwide rights (excluding Japan, where Takeda Pharmaceuticals holds rights) to Ceftaroline when it acquired Cerexa Inc, a privately held biopharmaceutical company, in 2007.
In August 2009, Forest Labs and AstraZeneca plc (AZN) entered into a definitive collaboration agreement to co-develop and commercialize Ceftaroline in all markets outside the U.S., Canada and Japan. AstraZeneca is expected to file for marketing authorization of Ceftaroline in Europe by the end of 2010.
In clinical studies, Ceftaroline has demonstrated bactericidal activity against a broad range of pathogens commonly implicated in cSSSI and CABP, including MRSA (methicillin-resistant Staphylococcus aureus) and MDRSP (multi-drug resistant Streptococcus pneumoniae).
If approved, Ceftaroline will compete with AstraZeneca's Merrem, ViroPharma's Vancomycin, Cubist Pharma's Cubicin, Pfizer's Zyvox and Tygacil, as well as Johnson & Johnson's Levaquin. According to analysts, Ceftaroline has a sales potential of $300 million to $400 million.
Ceftaroline is seen only as a modest top-line driver if approved. Forest Labs needs to develop or license blockbusters to plug the impending holes in its balance sheet when patents covering some of its key drugs expire in the next few years.
The company's antidepressant drug Lexapro loses patent protection in March 2012. The drug generated $2.3 billion in revenue last year. Yet another blockbuster drug of the company that will be going off-patent is Alzheimer's drug Namenda.
Namenda, which faces patent expiration in April 2015, had U.S. sales of $1.2 billion for the twelve months ended March 31, 2010, according to IMS Health.
During a post-earnings conference call in July, Larry Olanoff, the President and COO of Forest Labs, said that there are currently six phase III products in the company's pipeline, including Ceftaroline and respiratory drug Daxas.
While Ceftaroline faces the FDA panel for the first time next week, Daxas has already been at the FDA altar once. Daxas was voted down by the FDA panel in April, and in the following month was rejected by the FDA, which has asked for more information on the drug before it could be approved. However, the EU approved Daxas in July and was launched as recently as September 1 in Germany, making it the first country to market the drug.
The company has planned to seek approval for two drugs during 2011 - Aclidinium for chronic obstructive pulmonary disease and Linaclotide for chronic constipation and constipation-predominant irritable bowel syndrome, and for two more drugs in 2012 - Cariprazine for schizophrenia and bipolar mania and Levomilnacipran for depression.
Shares of Forest Labs have thus far hit a low of $24.17 and a high of $33.10 over the one-year period. The stock closed up 5.57% to $29.19 on Thursday on a volume of 7.54 million shares.
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