Adasuve – Alexza May Get What It Needs

“You can’t always get what you want (no, no baby)
You can’t always get what you want
You can’t always get what you want
But if you try sometimes you just might find
You get what you need, ah yes… “
Rolling Stones – “You Can’t Always Get What You Want”

Alexza may soon get what it needs, an FDA approval for Adasuve aka AZ-004. And Adasuve is right on schedule and budget; at least in terms of the average for all drug delivery enabled/enhanced products (DDEP) according to the report DDEP2011 [link]. Adasuve is a novel inhaled formulation of loxapine targeted to the treatment of agitation in patients suffering from schizophrenia or bipolar disorder (manic depressive disease).

In the past couple of weeks Alexza has provided two updates on Adasuve’s regulatory status: submission of a Marketing Authorization Application (MAA) to the European Medicines Agency (EMA), and a December 2012 Psychopharmacologic Drugs Advisory Committee (PDAC) meeting in the US. Both are important steps on the pathway to approval. The scheduling of the PDAC meeting by the FDA suggests there are no significant technical issues related to the Adasuve filing. With a Prescription Drug User Fee Act (PDUFA) goal date of February 4, 2012, Adasuve could be approved in a little over three months.

Clinical Development and Approval Times
Assuming a February 2012 approval, Adasuve will have taken about seven years to progress from first clinical to FDA approval. Despite the often optimistic statements made by companies developing drug delivery enhanced pharmaceuticals with previously approved actives, the seven year timeline for progression from first clinical to approval is about average for DDEP, and a little bit quicker than many inhaled DDEP.

Alexza initiated Phase I clinical trials for Adasuve in 2005, entered Phase III pivotal trials in early 2008 and filed the NDA in December 2009. This 5-year timeline is about average for all DDEP. Assuming approval is received by the PDUFA target date, review and approval will have taken a little more than two years, longer then average and much longer than the 10 months often seen with other DDEP.

Development Costs
Through the end 2010, expenses related to the development of Adasuve have totaled about $105 million, about $125 million in current dollars. This includes direct and overhead costs. It’s reasonable to expect that by the time FDA approval is received total costs will have reached about $120 million ($140 million in current dollars).

These cost figures are not surprising. Assuming a limited Phase I and Phase II development program, a minimal Phase III program with short endpoints, and approval on first NDA submission, a DDEP in theory can be approved for less than $10 million. In practice they aren’t. The only exceptions are DDEP approved solely on the basis of bioequivalence trials. Realistically, $25 million is the low-end budget required to take a DDEP through development and approval (DDEP2011 Report), not including technology development expenses.

Approved in 1975, loxapine has a long history of use for psychiatric indications, with marketed oral and injectable formulations. Any new product targeted to the out patient treatment of agitation would need to need to be simple to use, provide a rapid onset of action and preferably not involve an injection. By using the inhalation route, with a single-dose formulation Adasuve meets these needs. Additionally there is a requirement to demonstrate that Adasuve is safe and well tolerated in the short- and long-term, especially with increasing concerns about pulmonary delivery.

Given these demands, seven years and $140 million dollars to bring Adasuve through to approval as an inhalation formulation represents a strong performance, especially since this is Alexza’s first product using their Staccato inhalation system. Alexza surely hoped for a quicker and less demanding review and approval process when they filed their NDA in late 2009. Like too many smaller companies developing DDEP, Alexza submitted what they thought should be just enough to gain FDA approval. This approach has pros and cons; it can reduce costs and allow for an earlier filing, but it can unnecessarily extend the review time if the company is required to provide additional information or conduct additional trials. Although the review clock is not reset, it is delayed in comparison with a complete initial filing.

The Intermezzo (Transcept), and Afrezza (MannKind) NDAs, initially filed in 2008 and 2009 respectively, are suffering similar delays. Both of these companies have experienced so much drama with respect to revised estimates of approval dates, one might believe it would have been better to have delayed the filings until a more complete regulatory package was ready. While some have accused the FDA of review and approval delays because of process inefficiencies it is now generally understood that fault rests with companies submitting incomplete filings.

I’m hoping Adasuve makes it through the PDAC and receives approval in February. Alexza has done a good job of developing the product and their underlying Staccato technology. It’s time for them to enjoy the rewards of commercialization. But it won’t be easy. After a failed partnership with Biovail (now Valeant) Alexza is on its own in the US, and partnered with Grupo Ferrer in Europe and Latin America. I’m confident Alexza will find a partner in the US, but getting a similarly large license fee as was paid by Biovail will be difficult. Sales and profitability will be initially limited as Adasuve is targeting a rather small market with what is sure to be a restricted label and a premium price.

If you try hard enough you get what you need. The lesson here is that drug delivery enabled/enhanced products (DDEP) are not as quick and inexpensive to develop through approval as many companies would like to believe. Budgeting $75 to $150 million in costs and six to seven years for clinical development and approval seems a reasonable estimate of what it takes, regardless of what your investors and your R&D folks would like to believe.

Stuff happens.