It has been a rollercoaster ride so far this year for shareholders of Auxilium Pharmaceuticals Inc. (AUXL), a biopharmaceutical company that focuses on orthopediology, urology and sexual health. After all, it is the very nature of biotech stocks to be driven by hope and fear.
Shares of Auxilium have recovered over 12% from their August low of $27.62 and currently trade around $31. A potential near-term catalyst is the upcoming FDA panel decision on injectable collagenase Xiaflex, a drug licensed to Auxilium by BioSpecifics Technologies Corp. (BSTC).
On September 16, an advisory committee of the FDA is scheduled to review Xiaflex for the treatment of Dupuytren's disease.
Dupuytren's disease is a hereditary disorder characterized by the thickening of tissue beneath the skin on the palm of the hand and fingers, ultimately disabling the hand. About 13.5 million to 27 million people in United States and Europe suffer from Dupuytren's disease. Surgery is the only current treatment option for Dupuytren's disease, but requires a long recovery time and has a high recurrence rate.
Treatment with Xiaflex has the advantage of being minimally invasive and requires no anesthesia. According to Auxilium, there are potentially 240,000 patients for the treatment of Dupuytren's on an annual basis in the U.S. and Europe who could be candidates for Xiaflex. In the U.S., the average cost of Dupuytren's disease surgery is $5,000. Physician surveys indicate that surgeons would recommend the use of collagenase injection on 76% of the Dupuytren's disease patients who are candidates for surgery.
Apart from Dupuytren's disease, Xiaflex is also being evaluated as potential treatment for Peyronie's disease, which is a form of erectile dysfunction and Frozen shoulder syndrome (adhesive capsulitis), a painful condition in which the shoulder loses its range of movements.
Xiaflex is under phase II testing for Peyronie's disease and top-line results of the study are expected by the end of this year.
It is estimated that about 475,000 men visit urologists in the U.S. and Europe every year seeking treatment for Peyronie's disease, of which 210,000 patients could be potential candidates for Xiaflex treatment. About 90% of the U.S.-based urologists would use collagenase injection to avoid or delay surgery for Peyronie's disease patients, according to Auxilium Pharma.
With a large unmet medical need for a non-surgical solution to Dupuytren's and Peyronie's, Auxilium believes that Xiaflex has the potential to become a blockbuster. The product has received orphan drug designation in the U.S. for both indications. The patent covering Xiaflex for Dupuytren's expires in 2014, and that of Peyronie's expires in 2019.
Yet another potential indication for Xiaflex is as a treatment for frozen shoulder syndrome. The drug is under phase II trial for that indication. The disease is known to affect between 20 million and 50 million worldwide.
The development and license agreement for Xiaflex was originally crafted on June 3, 2004 between BioSpecifics and Auxilium and was amended on May 10, 2005 and December 15, 2005. Under the terms of the agreement, Auxilium has an exclusive worldwide license to develop products containing BioSpecifics' injectable collagenase for the treatment of Dupuytren's disease, Peyronie's disease and Frozen shoulder, with the exclusive option to license additional indications.
Last December, Auxilium sublicensed the rights to develop Xiaflex to Pfizer Inc. (PFE) for the treatment of Peyronie's and Dupuytren's in the 27 member countries of the European Union and 19 other European and Eurasian countries. Under the terms of the agreement, Auxilium received $75 million upfront payment from Pfizer and is also entitled to receive up to $410 million in incremental payments for regulatory and commercial based milestones if those milestones are achieved in the future. In addition, Auxilium is also eligible to receive significant, increasing, tiered, double-digit royalties based on sales of Xiaflex in Pfizer's territories.
Following the Auxilium-Pfizer deal late last year, BioSpecifics received $6.375 million upfront payment from Auxilium. BioSpecifics is also entitled to receive 8.5% of the $410 million in additional potential future milestone payments paid to Auxilium by Pfizer.
Pfizer expects to file Xiaflex for approval for the treatment of Dupuytren's disease in Europe in 2010.
In addition to Xiaflex, Auxilium's product pipeline includes AA4010, a treatment for overactive bladder, which uses the company's transmucosal film delivery system and Fentanyl pain product, which also uses the transmucosal film delivery system, both of which are under phase I testing.
Auxilium's only marketed product is Testim, a once-a-day gel, which is approved for use in treating men with hypogonadism, or low testosterone. Testim was approved by the FDA in October 2002. The product's sales have been increasing year over year, thanks to increased diagnosis, helped by education and awareness. It has been demonstrated that low testosterone is a co-morbid condition with others such as diabetes, obesity, hyperlipidemia, chronic pain and HIV/AIDS.
According to National Prescription Audit data from research firm IMS Health Inc., Testim's share of total prescriptions for the gel segment of the testosterone replacement therapy market was 22.0% in 2008, compared to 20.0% in 2007.
Sales of Testim totaled $125.4 million in 2008, an increase of 31% over the $95.7 million reported in 2007. In the second-quarter ended June 30, 2009 sales rose to $39 million from $30.9 million in the year-ago quarter.
Looking ahead to full year of 2009, Auxilium expects net loss to range between $50 million and $55 million on revenue of $155 million - $165 million. This compares with a net loss of $46 million and revenue of $125.4 million reported in 2008.
Auxilium, which went public in July 2004 pricing its IPO at $7.50 per share, recorded an all-time high of $42.75 on August 13, 2008. In the last twelve months, the stock has traded in the range of $15.44-$40.
With the FDA panel expected to make a recommendation next week on Xiaflex, which represents a blockbuster opportunity that can provide sustainable long-term growth, AUXL is a stock worth keeping an eye on. Stay tuned...
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.