La Jolla Pharmaceutical Co. received an approvable letter for its lupus drug candidate Riquent that requires the completion of another clinical study for final approval.

That study could take up to four years, meaning Riquent might not reach the market until 2008, an outlook that caused the company's stock to lose more than half of its value.

The shares (NASDAQ:LJPC) plummeted $1.67 Friday, or 60.5 percent, to close at $1.09.

"We clearly would have wished for a different outcome," said Steve Engle, La Jolla's chairman and CEO, in a conference call. "We believed the data that we provided in the NDA was supportive of a Subpart H approval. Because we feel we need additional clarity, we have already requested a meeting with the agency."

Under Subpart H, the agency's accelerated approval regulation, a post-marketing trial to confirm clinical benefit can begin prior to approval, but does not need to be completed until after approval. San Diego-based La Jolla started a Phase IV trial in August and plans to enroll between 500 and 600 patients. The double-blinded, randomized, placebo-controlled international trial was designed with the FDA under a special protocol assessment, and the primary endpoint is time to renal flare. (See BioWorld Today, Aug. 3, 2004.)

While the letter from the FDA was not a "no," it also was not a "go out and start marketing," Engle told BioWorld Today. Still, he and others from La Jolla are trying to keep their eye on the ball. Lupus affects about 1 million people in the U.S. and Europe, about half of whom have renal disease.

"There have been no new drugs approved for lupus in 30 years," Engle said.

Specifically, the approvable letter stated concerns over a previous Phase III study, 90-05, that failed to show a clinical benefit in the delayed time to renal flare endpoint. That was to be rectified with another Phase III, study 90-09, which focused on a subgroup of patients with high-affinity antibodies to double-stranded DNA. That, too, failed.

La Jolla, however, submitted the NDA in December 2003 after receiving FDA guidance to do so. While the data showed that Riquent (abetimus sodium) did not demonstrate a statistically significant increase in time to renal flare, researchers noted fewer renal flares and fewer major systemic lupus erythematosus flares in Riquent-treated patients, suggesting a benefit to patients if antibodies to dsDNA are reduced. (See BioWorld Today, Feb. 19, 2003, and May 6, 2003.)

The approvable letter was "not what we expected based on communications that we've had with the agency," Engle said.

The FDA emphasized the need for La Jolla to conduct another, better powered outcome trial, "perhaps with a larger dose," looking at an endpoint of clinical benefit, such as time to renal flare. The Phase IV study - called study 90-14 - appears to satisfy the requirement, "although," the letter states, "we think that it could be valuable to learn more about the dose response for the effect of abetimus on antibody titer before carrying out a large clinical trial of long duration."

The Phase IV study is randomizing patients into placebo and three dosage groups: one at 100 mg of Riquent per week, one at 300 mg per week, and one at 100 mg per week shifting to 300 mg at week 12. The patients will be treated for 12 months. Engle said he believes the Phase IV study will provide the kind of dose response information that the FDA is seeking.

"The study's moving ahead," he said. "It is going to gather that kind of information. If we wanted to do something else in parallel, we'd be willing to discuss that with them."

In addition to enrolling twice as many patients as the previous trial, the Phase IV study requires patients to have antibodies to dsDNA and a history of renal flare within the last four years. They also must not be receiving high doses of immunosuppressive agents.

La Jolla had intended to file for marketing approval in Europe later this year. It also had planned to find a European marketing partner and to market Riquent on its own in the U.S. Engle said those intentions will be reassessed following the company's discussions with the FDA.

"The key is to try to get clarity with the FDA before we do anything," he said. "One way to perceive where we are is we have an approvable letter with a clinical trial ongoing that according to the letter is sufficient for reaching approval if it's successful."

That may be an attractive asset to a potential partner.

"We would always prefer to keep the U.S. rights," Engle said, "but there may be things we have to do because of where we are."

The company has previously stated that it has enough cash to carry it into the second quarter of 2005. The company ended the second quarter with $42 million in the bank.

Engle estimates the Phase IV trial of Riquent could take four years to complete because the previous trial enrolled half as many patients and took about two years. He hopes, however, to include more European sites in the trial in order to enroll patients faster. A total of 17 U.S. sites currently are enrolling patients.

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