Avanir Pharmaceuticals: Full Steam Ahead

| About: Avanir Pharmaceuticals, (AVNR)

Avanir Pharmaceuticals (NASDAQ:AVNR) has recently launched its new drug, Nuedexta, the first and only FDA approved treatment for pseudobulbar affect (PBA). Avanir's plans for the full commercialization of Nuedexta appear to be well thought, well detailed, well funded, and well underway.

The Multiple Sclerosis Association of America has recently published encouraging results from a 5,000 patient survey, which revealed that PBA among MS patients could be far more prevalent than originally thought.

In addition to its growing specialized sales force, Avanir has a team of nine managed care specialists, all working to minimize the treatment cost impact on PBA patients while the drug is still under standard formulary review. The company is also currently in the process of hiring a Director of Business Development whose job responsibilities will include "identifying, structuring, negotiating, and executing transactions as well as managing ongoing and new European and Asia Pacific partnerships for NUEDEXTA." Avanir has made clear that one of its 2011 goals is to obtain regulatory clarity from the European Medicines Agency for the purposes of filing an application for the marketing and sales of Nuedexta for PBA in Europe.

Perhaps most importantly, Avanir has very recently chosen MS related pain to be the first potential follow on indication for Nuedexta.

MS related pain, like PBA, is an area of high unmet medical need. Once the investigational new drug application is filed, it is possible that the company will receive fast track designation and will likely only have to conduct one clinical trial, as there is already existing proof of concept data from two previous clinical trials which detail Nuedexta's effectiveness in treating MS related pain. The company is in the process of hiring a Clinical Research Physician and has stated that they plan to have the first patient enrolled in an MS related pain trial by the end of 2011.

As many investors already know, Nuedexta's approval for PBA was a successful effort at getting one of Avanir's feet in the door with its unique combination of dextromethorphan hydrobromide and quinidine sulfate. If approved for a pain indication, Nuedexta will have exposure to a substantially larger market than that of PBA and the company would undoubtedly see exponential sales growth (and outside interest) as a result.

Concerned about IP? Avanir believes they have strong intellectual property that should protect Nuedexta through 2027 which, as CEO Keith Katkin has recently stated, creates "a very nice, long runway to build a market and to make sure that patients suffering from PBA can benefit from Nuedexta."

In the void of any real news, specifically sales data, the company's stock has recently sunk to pre Nuedexta approval levels, closing on 03/07/11 at $3.43, down nearly 41% from its 52 week high of $5.80. As Avanir continues to execute on its well laid plans and actual sales figures start to roll in, I expect that Mr. Market will begin to appreciate the true value of this stock and patient AVNR shareholders will, at long last, have their day in the sun.

For more info on PBA visit here and here.

Disclosure: I am long AVNR.