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Based in Rockville, Maryland, Supernus Pharmaceuticals (proposed SUPN) scheduled a $75 million IPO with a market capitalization of $256 million at a price range-mid-point of $13 for Wednesday, April 25, 2012. [S-1]

SUPN is one of eight IPOs are scheduled for the week of April 23th. (Full IPO calendar here).

Manager, Joint Managers: Citigroup; Piper Jaffray.

SUPN is a specialty pharmaceutical company with product candidates for epilepsy & Attention Deficit Hyperactivity Disorder ADHD, with lots of competition in both product segments.

SUPN generated $39 million in operating losses for the year ended December 31, 2011. SUPN's IPO is to fund further clinical trials.

SUPN is a specialty pharmaceutical company focused on developing and commercializing products for the treatment of central nervous system, or CNS, diseases.

Since inception in 2005, SUPN has generated no revenue from product sales and have incurred significant operating losses.

SUPN's two epilepsy product candidates are SPN-538 (extended release topiramate), for which SUPN submitted a new drug application, or NDA, that was accepted for filing by the U.S. Food and Drug Administration, or the FDA, in November 2011, and SPN-804 (extended release oxcarbazepine) for which SUPN submitted an NDA that was accepted for filing by the FDA in February 2012.

The Prescription Drug User Fee Act, or PDUFA, date for SPN-538 is in July 2012. The PDUFA date for SPN-804 is in October 2012.

Attention deficit hyperactivity disorder (ADHD)
SUPN's ADHD product candidates include SPN-810 (molindone hydrochloride), which is in a Phase IIb trial as a novel treatment for impulsive aggression in patients with ADHD, and SPN-812, which completed a Phase IIa trial as a novel non-stimulant treatment for ADHD.

There are over 15 branded products, as well as their generic counterparts, on the U.S. market indicated to treat epilepsy.

In addition, competition in the attention deficit hyperactivity disorder, or ADHD, market in the United States has increased with the launch of several products in recent years, including the launch of generic versions of branded drugs such as Adderall XR.

According to Datamonitor, as of April 2010, there were 47 compounds in preclinical and clinical development for epilepsy across the United States, Japan, France, Germany, Italy, Spain and the United Kingdom.

Datamonitor reported that approximately 15 were in late-stage (Phase II or later) clinical trials as of April 2010. SUPN is also aware that Upsher-Smith announced the initiation of a Phase III clinical trial for USL255 (extended release topiramate) for the management of epilepsy in adults.

If successful, such competing product could limit the potential success of SPN-538.

In addition, SUPN is aware of companies who are marketing outside of the United States modified-release oxcarbazepine products, such as Apydan which is developed by Desitin Arzneimittel GmbH and requires twice-daily administration.

If companies with modified-release oxcarbazepine products outside of the United States obtain approval for their products within the United States prior to SUPN, such competing products may obtain three years of marketing exclusivity, which would significantly delay SUPN's entry into the U.S. market and limit the potential success of SPN-804.

SUPN expects to net $66.4 million from its IPO. Proceeds are allocated to fund clinical trials and for other general corporate purposes.

The market for SUPN's product candidates is crowded, and SUPN is burning through cash at a heavy rate. It seems prudent to pass on the SUPN IPO.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Disclaimer: This SUPN IPO report is based on a reading and analysis of SUPN's S-1 filing, and a separate, independent analysis by There are no unattributed direct quotes in this article.