While diquafosol tetrasodium failed to hit the primary endpoint in a Phase III trial for dry eye disease, Inspire Pharmaceuticals Inc. plans to file a new drug application amendment by the end of the second quarter.

Data from several clinical trials combined to show a clear benefit in the corneal clearing and corneal staining endpoints, the company said. And based on Inspire's discussions with the FDA, those results should support an approval.

Still, news that Study 109 failed to demonstrate a statistically significant improvement of the incidence of corneal clearing (p=0.369) crushed the company's stock Wednesday. It (NASDAQ:ISPH) fell 44.5 percent, or $7.12, to close at $8.88.

Study 109 was a six-week, randomized, double-masked trial comparing 2 percent diquafosol ophthalmic solution to placebo in 640 patients at 34 U.S. sites. About 81 percent of the patients were women and the mean age was 61 years. There were few dropouts, with 94 percent of the patients completing the study.

"We did not demonstrate a statistically significant difference for the primary endpoint," said Christy Shaffer, CEO of Durham, N.C.-based Inspire. "However, we did, in fact, see positive results on several key secondary endpoints."

While diquafosol did not show a significant improvement in corneal clearing, it did demonstrate benefit over placebo in terms of mean corneal staining (p<0.001), mean conjunctival staining (p=0.002) and conjunctival clearing (p=0.019).

Diquafosol failed to show improvement in symptoms compared to placebo using the Ocular Surface Disease Index, a dry eye symptom questionnaire, and in analysis of patients' worst symptom score.

"We were unable to show any benefits on symptoms in this relatively short trial of six weeks duration," Shaffer said in a conference call. "And in our previous trials, symptomatic improvements appeared to occur much later."

Shaffer said the adverse event profile was consistent with previous trials. The most common ocular adverse event, burning and stinging on instillation, occurred more frequently with diquafosol than placebo, but the incidence was less than 5 percent.

Inspire intends to file an amendment to the NDA by the end of the second quarter. The company expects a six-month FDA review, meaning a decision could come by the end of this year.

A major problem in conducting dry eye trials is that companies do not have a clear direction in which to take their research. There is no formal written guidance from the FDA for dry eye, and only Allergan Inc.'s Restasis is approved for the indication.

"What it takes to get approval is what has been evolving over time," said Jenny Kobin, Inspire's senior director of investor relations. "There is no specific path, so it's an evolving process."

Diquafosol is partnered with Irvine, Calif.-based Allergan, the developer of two products that Inspire markets: the aforementioned Restasis for dry eye, as well as Elestat for allergic conjunctivitis.

In terms of a European filing, Inspire is working with Allergan and regulatory authorities to develop a strategy. Shaffer said the companies might need to do a longer trial looking at the symptoms of dry eye to further support the NDA or a European submission.

Inspire first filed the NDA in June 2003, and it received an approvable letter in December 2003. The FDA said at the time that final approval hinged on Inspire's ability to replicate the corneal staining results seen in Study 105. (See BioWorld Today, Dec. 23, 2003.)

Since the NDA filing, Inspire has completed two additional studies: Study 108 and Study 109. The amendment will contain full data from both trials, focusing on cumulative evidence of corneal clearing across all studies, including Study 105.

Corneal staining depicts mild abrasions on the eye, which leaves it vulnerable to infection.

"The staining is really a test that the doctor does in the office," Kobin told BioWorld Today, "where he puts the drops in, and if there's damage or abrasions on the cornea, then the dye is going to stick to the cornea."

Study 108 missed its primary endpoint of reducing exacerbation of dry eye after exposure to the chamber, a controlled environment used for testing. But the study did demonstrate a significant improvement in a secondary endpoint of ocular clearing, which includes the clearance of the cornea and portions of the conjunctiva.

Study 109, in turn, demonstrated corneal clearing in the central region of the cornea, an important area of the eye for vision.

Between the data from those two trials, as well as from Study 105, the company said it will have a strong amendment package for approval. Study 105 hit its primary endpoint of mean corneal staining in June 2002. (See BioWorld Today, June 19, 2002.)

Kobin said that dry eye disease affects about 30 million people in the eight major international markets, or about 10 million people in North America.

"From a dollar standpoint," she said, "we estimate that the sale of prescription and over-the-counter products for dry eye in the U.S. would exceed $500 million annually."

Inspire intends to expand development of diquafosol by starting a pilot study this month in 30 patients undergoing refractive surgery for coronary wound healing. Those results should be available before the end of this year.

Aside from diquafosol, Inspire has INS37217 Ophthalmic in Phase II trials for retinal detachment and INS37217 Respiratory in Phase II for cystic fibrosis, with the latter slated to enter a Phase III trial by the end of this year.

Inspire has more than $150 million in the bank, enough to carry it out several years, Kobin said.

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