Assistant Managing Editor

Shares of Indevus Pharmaceuticals Inc. plunged nearly 70 percent after the company reported at least a two-year setback for Nebido, its three-month formulation of testosterone, for male hypogonadism in the wake of safety concerns raised the FDA.

The Lexington, Mass.-based firm submitted a new drug application in August 2007, based on data from six studies involving more than 400 patients, including a 237-patient Phase III study, which showed that 94 percent of patients receiving 1,000 mg of Nebido and 86 percent receiving the 750-mg dose ended up with normal testosterone levels, well above the 75 percent required for FDA approval. (See BioWorld Today, Aug. 29, 2007.)

Shareholders had been banking on a nod for Nebido (testosterone undecanoate) by the June 27 PDUFA date, but Indevus said it recently was informed that the agency wanted additional safety data. Although the company has yet to receive formal communication from the FDA - written notice is expected by the PDUFA date - Indevus said the FDA's concerns likely stem from adverse events relating to injection reactions that were reported in postmarketing studies in Europe, where the product already is approved.

"We believe the FDA is concerned about a rare cough reaction by some patients immediately following injection," said Robin DeCarlo, director of corporate communications at Indevus.

The company called the reaction a "known rare complication" of injections using oil-based depots, in which a small amount of oily solution enters the vascular system from the injection site and causes short-term reactions such as coughing and shortness of breath. In U.S. trials, there was a single instance of that reaction in a patient receiving the 750-mg dose, which was considered nonserious and was resolved without issue in about 10 minutes.

But the FDA might want more data indicating the frequency of such events. To supply those data, Indevus said it likely would have to conduct another trial, but what that would entail cannot yet be determined.

"We'll be able to finalize all study details following receipt of formal communication" from the FDA, DeCarlo told BioWorld Today.

Regardless, the company said it expects a delay of about 18 months before it can re-file the NDA. An FDA review would take an additional six months, which means the earliest Nebido could hit the market would be mid-2010.

That news sent investors fleeing Indevus' stock all day. Trading at more than 70 times its usual volume, the company's shares (NASDAQ:IDEV) lost $2.84, or 69.3 percent, to close Wednesday at $1.26.

Nebido's approval would have given the firm a second product in the estimated $550 million U.S. testosterone therapy market. Indevus already markets Delatestryl (testosterone enanthate), which is designed for injection once every two to four weeks. Indevus recognized revenue of $400,000 from sales of Delatestryl for the first three months of 2008.

With its less-frequent dosing regimen, Nebido is aimed to help the firm capture more of the injectable market space. Indevus has said that about 130,000 of the 340,000 men receiving testosterone therapy use injectable products. The others use topical treatments.

But there still remains a significant market. Indevus has estimated that 4 million to 5 million men in the U.S. suffer from hypogonadism, a condition characterized by a reduced or absent secretion of testosterone from the testes, though fewer than 10 percent currently are treated with testosterone therapy.

Indevus acquired rights to Nebido in a July 2005 deal with Berlin-based Bayer Schering Pharma AG. That deal called for payments of $30 million to Bayer Schering, including a $5 million payment upon FDA approval. The big pharma firm also would receive an undisclosed percentage of sales when Nebido reaches the market.

Indevus Chairman and CEO Glenn L. Cooper said in a press release that beyond the safety concerns raised in verbal discussions with the FDA, the company is "not aware of any other approvability issues" relating to Nebido.

The firm, which posted a net loss of $17.9 million, or 23 cents per share, for the first three months of 2008, had about $60.8 million in cash and cash equivalents as of March 31.

DeCarlo said the firm had "about a year's worth of cash," and was well positioned to conduct the additional Nebido trial. "Our expenses relating to the launch of Nebido are essentially delayed," she said, "so we'll utilize those resources to fund the clinical trial."

Indevus already has an established sales force, tasked with marketing the company's approved products. Besides Delatestryl, it has Sanctura, a muscarinic receptor antagonist for overactive bladder drug, as well as Vantas, a luteinizing hormone-releasing hormone (LHRH) agonist for prostate cancer, and Supprelin LA, an LHRH agonist for central precocious puberty. Most of the additional sales reps for Nebido would not be brought on board until after marketing approval.