By Debbie Strickland
Almost a full quarter ahead of schedule, Connetics Corp. filed its first new drug application with the FDA, requesting marketing clearance for a mousse formulation of betamethasone to treat all steroid responsive dermatoses, including psoriasis.
"Our goal was to get the NDA filed in the first quarter of 1998, within a February/March time frame," said John Higgins, chief financial officer. "But the process went smoothly, and we actually got [the application] in in December."
Connetics will sell the drug, which, if approved, could hit the market in early 1999. Some 3 million Americans suffer scalp psoriasis, the company said, adding that the U.S. market for mid-potency topical steroids tops $200 million.
Betamethasone mousse is a stabilized foam formulation of betamethasone 17-alpha-valerate. When applied to the body, betamethasone mousse liquefies and remains localized at the disease site. It is currently on the market in the U.K. for the treatment of scalp psoriasis and seborrheic dermatitis.
Connetics licensed the product from Soltec Research Pty. Ltd., in Melbourne, Australia.
In a Phase III study, patients treated with betamethasone mousse, administered twice a day for 28 days, experienced a statistically significant improvement over patients in the groups treated with betamethasone lotion (the same concentration of betamethasone in a lotion form) or placebo in all primary endpoints, including erythema (redness of the skin), plaque thickness and scaling.
A physicians' global assessment showed 67 percent of patients treated with the mousse formulation had complete or almost complete clearance compared with 46 percent treated with the lotion and 19 percent treated with placebo.
Although the original license to the mousse formulation covered only betamethasone, Connetics has since acquired additional rights from Soltec, making possible a future line up of three to five mousse-formulated products, according to Higgins.
"It's definitely part of our business plan . . . to bring other drug candidates into development with the mousse formulation," he said. "If things go well, we would intend to develop several."
Betamethasone mousse contains a mid-potency steroid, but the next product candidate will be a high-potency steroid, said Higgins, with a Phase III trial expected to commence in mid-1998.
That product's developmental timetable would likely mirror that of betamethasone, a product that "exemplifies Connetics' mission — rapid development of novel therapeutics," said Thomas Wiggans, president and CEO, in a prepared statement. "We in-licensed the product, formulated the drug candidate, conducted a Phase III trial and filed an NDA, all within 18 months."
The NDA filing rounds out a spate of good news from the Palo Alto, Calif., firm, which in recent days has also closed an oversubscribed $5.3 million self-managed public offering; negotiated a deferral of payments to London-based SmithKline Beecham plc for licensed rights to Ridaura, a rheumatoid arthritis treatment; and sold Canadian Ridaura rights to Pharmascience Inc., of Montreal.
Proceeds from the sale of 1.75 million common shares will fund clinical development, the company said. The lead investor was Amerindo Investment Advisors Inc., of New York.
Connetics gained another $1.4 million by selling Ridaura rights in Canada, where the company had not been actively marketing the product. Canadian orders for the nine months ending Sept. 30 totaled $257,000.
Further boosting the near-term bottom line, the SmithKline Beecham payment restructuring slashes a Ridaura payment — due this month — from $6 million to $1 million, with the remaining $5 million to come later this year and in early 1999.
"In light of our current stock price, it really was in everybody's interest to amend these payment terms," said Higgins.
Last summer, the company's shares, which had been trading in the $7 to $9 range, lost almost half their value when gamma interferon for atopic dermatitis failed. The stock has since drifted further down, falling below $3 at one point.
The financing and Ridaura news boosted Connetics shares to $3.375 Monday, a gain of $0.375, or 12.5 percent.
The company changed its name in May 1997 from Connective Therapeutics Inc. and took over Ridaura sales in June. The company's first marketing efforts are going well, said Higgins, noting that the sales force has doubled in size to 14 in six months.
Product revenues for the first nine months of 1997 totaled $5.1 million. As of Sept. 30, Connetics had $14.1 million in cash, cash equivalents, and short-term investments, following a nine-month net loss of $23 million. *