Alexza's CEO Has High Expectations Of Receiving FDA Approval For Adasuve

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 |  About: Alexza Pharmaceuticals, Inc. (ALXA)
by: Ben Yoffe

Alexza (NASDAQ:ALXA) is a pharmaceutical company which is developing novel, proprietary products for the acute treatment of central nervous system conditions. Its product candidates are based on a proprietary technology, the Staccato system, which provides rapid systemic delivery of drugs through inhalation. With the Staccato system, a drug is quickly absorbed through the lungs into the bloodstream, providing speed of therapeutic onset that is comparable to intravenous administration, but with greater ease, patient comfort and convenience.

Alexza's lead product is Adasuve, which is being developed for the acute treatment of agitation associated with schizophrenia or bipolar I disorder in adults. Alexza successfully completed two Phase 3 trials: a 344-patient trial for schizophrenia and a 314-patient trial for bipolar disorder. Both trials met primary and secondary endpoints.

In May 2012, Alexza received a second CRL from the FDA regarding the Adasuve NDA. However, Alexza resubmitted the Adasuve NDA in June and is currently under FDA review (PDUFA), which Alexza anticipates an approval decision on December 21, 2012.

In October 2011, the company established a commercial partnership for Adasuve with Grupo Ferrer Internacional, to commercialize Adasuve in Europe, Latin America, Russia and the Commonwealth of Independent States countries. Alexza filed its Adasuve Marketing Authorization Application with the European Medicines Agency in October 2011. In July 2012, Alexza submitted its responses to the Committee for Medicinal Products for Human Use Consolidated List of Questions (Day 120 List of Questions).

I have the pleasure to present to you an exclusive interview I held with Alexza's President and CEO, Mr. Thomas B. King.

Mr. Thomas B. King has served as the President, Chief Executive Officer and a member of the board of Alexza since June 2003. Mr. King previously served as President, Chief Executive Officer and a member of the board of Cognetix and President & Chief Executive Officer of Anesta Corp. He also served on the board at Achaogen, Inc. and Orphan Medical, Inc.

Ben Yoffe: Mr. King, Alexza will face an exciting event in the end of this year, when the FDA will decide by December 21 whether or not to approve Adasuve. Can you tell us your expectations?

King: We have high expectations for receiving approval of Adasuve in December. The CRL we received in May was based on a few manufacturing paperwork process related items. We also received the FDA's near final draft of our product labeling with the CRL. We believe we have addressed the manufacturing issues outlined by the FDA, and have also resubmitted what we feel is a close-to-final version of our package insert and our REMS program.

Yoffe: Do you think the back and forth between the FDA and Alexza may increase the odds of approval?

King: During the review periods for the Adasuve NDA, we have had much dialog with the FDA. We have also continued to reduce the outstanding items, through this process. In the second CRL, there were no clinical or safety-related questions, and we feel the package insert and REMS program are in near final forms, as we have no conceptual disagreements on these items with the FDA.

Yoffe: What is the potential market for Adasuve in the U.S?

King: Agitation is an important unmet medical need, which is not well understood by many, as it is difficult to research and to collect data on. In the US, Adasuve will be approved for use in a hospital setting to treat agitation in adult patients with schizophrenia and bipolar I disorder. The clinical data from our Phase 3 studies is strong and compelling, in light of the other products, both approved and unapproved. We believe that the Adasuve market potential in this hospital setting is more than $200mm per year.

Yoffe: Is there any competition?

King: Many products are used to treat agitation, some approved, some not approved. There is little, if any, promotion in the agitation market. Moreover, Adasuve would be the first anti-agitation product that meets all three of the key clinical criteria outlined by the experts' consensus guidelines, and will have a focused, directed promotional effort in this market.

Yoffe: What is your commercialization plan for Adasuve in the U.S?

King: Alexza expects to commercialize Adasuve in the US with a partner, similar to the relationship we have with Grupo Ferrer for Europe and Latin America. We are in the middle of discussions with possible partner candidates at this time.

Yoffe: Your market expansion plans for Adasuve including the marketing authorization application pending before the European Medicines Agency. When you expect to receive a final decision from the EMA?

King: The CHMP decision date (Day 210) is projected for mid-December at this point. This will be an important date in the EU regulatory process, and would allow Ferrer to be able to launch Adasuve in Europe in the second quarter next year. So December is shaping up to be a very important month for us, in the development of Adasuve.

Yoffe: What is the market opportunity in Europe?

King: We project the EU market to be approximately 50% of the US market opportunity in terms of units or volume. Pricing will vary from country to country, and is expected in some countries to be on par with the US pricing, and less in other countries. So in general, the EU market opportunity is approximately 40-50% of the US market opportunity.

Yoffe: When you expect to have a decision regarding the European Good Manufacturing Practices certificate for Alexza's manufacturing facility?

King: We have heard from the EMA regarding our EU PAI, and fully expect to receive our EU GMP certificate for our facility in due course.

Yoffe: Do you have plans to market Adasuve in the rest of the world?

King: We have active discussions regarding other key territories of the world, including Asia, Middle East and Africa. There are some excellent companies who have done great work in taking specialty products to these regions, and it is exciting to learn about the commercial opportunities for Adasuve in these areas.

Yoffe: Are there any other significant products in Alexza's clinical-stage pipeline?

King: We have AZ-002 (Staccato alprazolam) back into development for acute repetitive seizures, and expect to be back in the clinical with AZ-002 in the first half of 2013.

Yoffe: For closing, what is the financial picture for Alexza? Does the company has enough cash to get through the PDUFA date?

King: Our current cash forecast is that we have cash into the fourth quarter. We recently renewed our equity line with Azimuth, which will provide us adequate capital to get beyond our Adasuve PDUFA date. We fully expect that partnering activities will be an additional source of capital for Alexza.

Disclosure: I am long ALXA.