Shares of Furiex Pharmaceuticals Inc. (FURX) have gained more than 15 percent in the last three months and trade around $16. This drug development company helps drug developers lower development costs and deliver products to the market more efficiently using its unique and flexible risk-sharing model.
For readers who are new to Furiex Pharma, here's a brief overview of the company and what to expect in the coming months...
Furiex was launched as an independent company in mid-2010 through a spin-off from Pharmaceutical Product Development Inc. (PPDI). Furiex develops and commercializes therapeutics by in-licensing from or forming strategic alliances with pharmaceutical and biotechnology firms and shares the risks and rewards.
The company's pipeline includes, two compounds that are currently marketed by its collaborators outside of the United States, and three products in clinical development.
The two commercialized products are Alogliptin and Dapoxetine.
* Alogliptin is marketed in Japan by Takeda Pharmaceutical Ltd., under the trade name Nesina, for the oral treatment of type-2 diabetes. Alogliptin, a highly selective dipeptidyl peptidase-4, or DPP-4, inhibitor, was discovered by Syrrx Inc. and it came into Takeda's fold when Syrrx was acquired by Takeda in 2005.
In 2003, Pharmaceutical Product Development Inc., the parent company of Furiex, entered into a collaboration agreement to develop Syrrx's orally active DPP4 inhibitors to treat type 2 diabetes and other major human diseases. Takeda acquired development and commercialization rights to these DPP4 inhibitors when it purchased Syrrx.
Under the agreement with Takeda, Furiex is entitled to receive up to $45.0 million in future regulatory milestone payments, and up to $33.0 million in sales-based milestone payments. Furiex is also eligible to receive payments on worldwide sales of Nesina based on royalty rates of 7% to 12% in the U.S., 4% to 8% in Europe and Japan and 3% to 7% in regions other than the U.S., Europe or Japan.
Takeda is also seeking approval of Alogliptin as well as fixed-dose combinations of Alogliptin/Pioglitazone and Alogliptin/Metformin in the United States. Pioglitazone, jointly developed by Takeda North America and Eli Lilly, was approved by the FDA in 1999 for the treatment of type II diabetes.
The FDA issued a complete response letter for Alogliptin NDA in June 2009 and a complete response letter on the NDA for fixed dose combination of Alogliptin and Pioglitazone in September 2009.
Takeda resubmitted the New Drug Applications for Alogliptin and the fixed-dose combination of Alogliptin/Pioglitazone last July. The FDA was originally slated to decide on the two NDAs on January 25, 2012, but postponed the action date to April 25, 2012. If U.S. approval is granted, Fureix would pocket a $25.0 million milestone payment as well as potential royalties and sales-based milestones.
The fixed-dose combination of Alogliptin/Pioglitazone was approved in Japan for the treatment of type 2 diabetes last July and the therapy has been available in Japan under the brand name Liovel since September, 2011.
A new drug application for the fixed-dose combination Alogliptin/Metformin for type 2 diabetes was submitted by Takeda to the FDA in November 2011. Metformin is also an oral medication for treating type 2 diabetes.
* Dapoxetine, an oral medication for "on-demand" treatment of premature ejaculation, marketed by Janssen-Cilag, a division of Johnson & Johnson (JNJ), in 14 countries in Europe, Asia-Pacific and Latin America under the trade name Priligy, is the second commercialized product.
Priligy is a unique, short-acting, selective serotonin reuptake inhibitor, or SSRI, which Fureix acquired from Eli Lilly and Co. (LLY) , and out-licensed it to Alza Corp.
Under the license agreement with Alza, Fureix is eligible to receive up to $15.0 million in additional regulatory milestone payments, up to $50.0 million in sales-based milestone payments, and sales-based royalties based on the level of Priligy sales worldwide. Fureix is obligated to pay Lilly a royalty of 5% on annual sales in excess of $800.0 million.
It was only as recently as January 31, 2012, that Priligy was approved as the on-demand treatment of premature ejaculation in men between the ages of 18 and 64, in the European Union Member States where the drug was not approved before, and also in Norway and Iceland.
The compounds under clinical development include,
* MuDelta, a phase III-ready investigational agent, for diarrhea-predominant irritable bowel syndrome, exclusively licensed from Janssen Pharmaceutica N.V.
* JNJ-Q2, a broad spectrum antibiotic for severe infections including methicillin-resistant "Staph" aureus under phase II testing, which is also licensed from Janssen Pharmaceutica, and
* PPD-10558 for treatment of high cholesterol in patients with statin-associated myalgia, licensed from Ranbaxy Laboratories Ltd.
In November 2011, Furiex acquired full exclusive license to MuDelta for the treatment of diarrhea-predominant irritable bowel syndrome, or IBS-D, under its existing agreement with Janssen Pharmaceutica. Following a successful meeting with the FDA last November, the company now has a clear regulatory path on the design of its proposed MuDelta phase III development plan for IBS-D.
The company has decided not to move forward with PPD-10558, following the recent phase II clinical trial's failure to meet its primary efficacy endpoint.
A quick look at the company's balance sheet...
Since the spin-off, Fureix has incurred losses and negative cash flows from operations. Revenue is generated in the form of upfront payments, development and regulatory milestone payments, royalties and sales-based milestone payments in connection with the out-licensing of compounds.
In the third quarter ended September 30, 2011, net loss narrowed to $13.0 million or $1.32 per share from $21.2 million or $2.14 per share in the comparable year-ago quarter, primarily due to decrease in research and development expenses. Revenue in the third quarter 2011 was $1.3 million, which comprised of royalties related to Priligy sales in various countries outside of the United States and Nesina sales in Japan, compared to $0.3 million for the same period in the prior year.
As of September 30, 2011, the company had $54.8 million of cash, cash equivalents and short-term investments.
The company is scheduled to release its fourth quarter and full year 2011 financial results on Tuesday, February 21, 2012, after the market closes.
FURX has thus far hit a 52-week low of $12.25 and a 52-week high of $19.55. The stock gained 2.56% on Thursday to close the day's trading at $16.45.
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