West Coast Editor

Already well below its $7-plus price range of late last year, Zonagen Inc.’s stock fell another 57.1 percent Tuesday on news that Schering-Plough Corp., the worldwide licensee for Vasomax, is withdrawing the application for marketing in the United Kingdom.

Madison, N.J.-based Schering-Plough’s decision came after examining comments from the UK’s Committee on Safety of Medicines. Zonagen’s shares (NASDAQ:ZONA) closed Tuesday at $1.46, down $1.94.

“We’re seeing a series of new [erectile dysfunction] drugs,” Joseph Podolski, president and CEO of Zonagen, told BioWorld Today. “My theory had been that, with a different mechanism of action, we’d still be able to carve out a reasonable niche. But the longer this goes on, you have to question how many more dollars you want to put into it.”

Zonagen, of The Woodlands, Texas, first ran into trouble in August 1999 in the U.S., when the FDA put a clinical hold on both of the firm’s phentalomine-based drugs, Vasomax and Vasofem (for sexual dysfunction in women), based on a preliminary analysis of a two-year rat study that showed male rats given Vasomax had a higher incidence of proliferation of brown fat tissue than control rats. (See BioWorld Today, Aug. 11, 1999.)

The drug remains on partial clinical hold in the U.S., pending a determination on whether it causes brown fat proliferation in mice. Things seemed to be looking up in December, when Zonagen offered preliminary interim study results from gross necropsies of rats exposed to phentalomine in various doses over one year, suggesting the drug did not contribute to brown fat proliferation.

More complete results are being prepared, Podolski said.

“We’re still on clinical hold, and the only way we’ll get off clinical hold is by getting this mechanistic data in front of the FDA,” Podolski said. Although Schering-Plough is the worldwide licensee, the FDA filing is Zonagen’s, he added.

In the UK, where Vasomax also had been on clinical hold, Schering-Plough late last year answered questions about the marketing application for Vasomax, and Zonagen expressed hope in January that the drug could gain approval in the UK.

Apparently not. Further comments from the government have led to Schering-Plough’s withdrawal of the application. Podolski said Schering-Plough has said “nothing definitive” about pulling out of the deal altogether, “but the ball’s in their court.”

Podolski said he was unsure of the nature of the UK government’s questions, but the brown fat issue there was resolved in 2000. The plan had been to use the same filing package throughout Europe.

Vasomax is an immediate-release oral formulation of phentolamine mesylate, which is a short-term alpha-adrenergic receptor blocker that stimulates smooth muscle relaxation and causes vasodilation. Approved decades ago as a treatment for hypertension and used more recently in diagnosing adrenal tumors, phentolamine has been used off-label for erectile dysfunction.

Despite Schering-Plough’s decision in the UK, Zonagen is pulling together data for the FDA.

“I’m not saying we’re willing to commit to any new studies, but certainly we’re going to follow through with the next step,” Podolski said.