Aoxing Wins Approval for Trial of Drug Dependence Therapy

| About: Aoxing Pharmaceutical (AXN)

Aoxing Pharmaceutical (NYSEMKT:AXN) has been given SFDA approval to begin a clinical trial of buprenorphine/naloxone sublingual tablets as a maintenance therapy for opioid addiction. Aoxing plans to start the trial of the therapy, which is not yet available in China, later this year. The test will be completed in mid-2011 and, if all goes well, it will launch in mid-2012.

Marketed as Suboxone in the US, the tablets combine a weak narcotic (buprenorphine) with a narcotic antagonist (naloxone), which is added to prevent abuse of the narcotic. In sublingual administration, very little of the naloxone reaches the bloodstream, keeping the effects of the antagonist to a minimum. However, if addicts attempt to misuse the drug by injecting it, naloxone will produce very strong withdrawal symptoms in opioid addicts.

The registration trial is a multi-center, randomized, double-blind and active-control study, which will enroll about 280 patients registered at Compulsory Drug Dependence Treatment Centers. Subjects are randomized during a brief induction phase, a multi-week maintenance phase and a detoxification phase. The trial will be administered by the National Institute on Drug Dependence of China at Beijing University, which is Aoxing Pharma’s partner on the drug.

Buprenorphine/naloxone sublingual tablets combine buprenorphine HCl and naloxone HCl dihydrate at a ratio of 4:1 buprenorphine: naloxone. Sales of the branded combination were $900 million in 2009.

The tablets are usually taken once a day and are prescribed to treat opioid dependence, which includes heroin and narcotic painkillers.

Aoxing is one of just 13 drug companies in China that holds a hard-to-get license to produce narcotic drugs. For the first nine months of fiscal 2010 (ended March 31, 2010), Aoxing posted a $3.9 million loss on sales of $4.6 million. Revenues were 39% lower than the previous year. The company explained that relocating its manufacturing facilities has kept revenues low as the facility strives to be GMP certified.

American Oriental Bioengineering (NYSE: AOB) owns a 35% stake in Aoxing Pharma, which is headquartered in Shijiazhuang City, outside Beijing.