Avanir Pharmaceuticals (NASDAQ:AVNR) opened the new trading week with news that it has filed an Investigational New Drug application with the U.S. Food and Drug Administration to begin a Phase II trial for its investigational drug, AVP-923, in the treatment of central neuropathic pain in patients with multiple sclerosis.
The product is also being tested in a late-stage trial for diabetic peripheral neuropathic pain and has been approved as Nuedexta late last year for the treatment of pseudobulbar affect, a condition characterized by spontaneous and uncontrollable laughing and/or crying.
Nuedexta is expected to become a first-line treatment for PBA since there is effectively no approved competition on the market to treat that indication and analysts predict that the product could rake in up to half a billion dollars on an annual basis in the coming years.
The multiple sclerosis trial is expected to enroll up to 400 patients at 65 centers both in the United States and abroad and bolsters the potential for Avanir to develop and market AVP-923 on a large commercial scale for the treatment of various indications of the central nervous system.
Avanir expects to enroll the first patient before the end of this year.
With the already-approved Nuedexta and the possibilities of AVP-923 being approved for additional indications, Avanir should be on the radars of large pharmaceutical companies that might be looking to boost their pipelines at a time when many money-making drugs will be coming off-patent.
The recent slide in the AVNR share price following a post-approval stock offering should also have the company on the eyes of the retail investor looking for a decent mid to long term growth pick in the biotech/pharmaceutical sector.
Nuedexta has only recently hit the market, so it'll take a couple of quarters to see just how well this product will "hit the ground" running, but the long term potential of AVNR as a company is only just growing.
It's likely that the curious "steal" of a share price that AVNR saw in the last hour of trading on the day before the approval announcement will not repeat itself, but it's definitely one to keep an eye on.
Disclosure: I am long AVNR.