The Women’s Health Initiative ('WHI'), a study that demonstrated several lethal side-effects of hormone replacement therapy ('HRT'), has left many pharmaceutical companies scrambling to advance alternative therapies to meet the unique market demand created by the drop in hormone sales. Although several therapies have advanced to late-stage clinical studies, few represent a truly novel approach.

Pristiq, Wyeth’s (WYE) new treatment for depression and potentially –post menopausal hot flashes, is merely a metabolite of the multi-billion dollar blockbuster, Effexor. Aprella, Wyeth’s investigational combination product for the treatment of menopausal symptoms, repackages two commonly used classes of drugs; estrogens and selective estrogen receptor modulators. Instead of improvements in side-effects or enhanced efficacy, the pharmaceutical industry has employed a model where minor chemical alterations coupled with a profound marketing engine compensates for declining sales from products with patent expiration. It’s very seldom to find a pharmaceutical company that is developing a truly novel approach to therapeutics.

Several weeks ago, DepoMed (NASDAQ:DEPO), a specialty pharmaceutical company, announced positive phase 3 trial results for the treatment of Post Herpetic Neuralgia (‘PHN’) with DM1796. But DepoMed’s news of success was soon eclipsed. Only one week later, the company announced that Serada didn’t meet its primary endpoints in two pivotal Phase 3 clinical trials for the treatment of vasomotor symptoms, more commonly known as hot flashes.

Since the upsetting trial data, DepoMed’s stock price has tanked over 50%, yet not one majority-shareholder has sold any shares. Could it be that “smart money” sees something that the ‘market’ doesn’t see?

Before the Women’s Health Initiative (‘WHI’), women were effectively treating their menopausal symptoms with hormone replacement therapy (‘HRT’), such as Premarin, Prempro and others. But since then, the medical community has carefully examined the toxicity of these hormones and is now more cautious of their usage. The prescriptions for hormones for menopausal symptoms have been cut in half since WHI. This presents an opportunity for the next safe and effective treatment option.

It seems that the consumer has been more vigorous in avoiding hormones than physicians. Most gynecologists still recommend the use of hormones because there are few other FDA approved options, but patients are seeking alternatives. Gynecologists estimate that 1/3 of women seeking treatment for menopausal symptoms are on conventional prescription hormones ('HRT'), despite a greater risk for heart disease, cancer, stroke, breast cancer and blood clotting. Another 1/3 of women are taking prescription or OTC bio-identical hormones. The advertisements for these treatments often tout that it is a “natural alternative”, yet evidence from medical literature shows that bio-identical hormones have the same safety concerns as HRT. The final 1/3 of women are seeking alternative therapies like Black Cohosh, acupuncture or topical creams, despite the lack of clinical trials proving efficacy or FDA oversight regulating quality control.

On Monday, a consortium of drug companies lobbied the FDA, saying, “products that include acetaminophen (Tylenol) should stay on the market” despite concerns of widespread liver damage. Drug manufacturers offered to more clearly “warn buyers about the risks of liver damage linked to the Tylenol” instead of the FDA’s more drastic options: a full-out ban.

Too much Tylenol has been causing acute fulminate liver failure for decades. So why is the FDA acting now? FDA officials are specifically worried about “cold and cough” products that combine Tylenol with other medications. Patients can be at risk, by unknowingly, taking too much of these medication. According to Reuters, "FDA officials consider the ingredient safe when taken as directed but worry that the growing number of liver failure cases shows that overdose remains a serious public health problem." Furthermore, the FDA wants to lower the maximum daily dose of acetaminophen. The FDA wants stronger warnings on the following product: Tylenol, Vicks Formula 44, NyQuil, Theraflu, Percocet, Robitussin Cough Cold & Flu, Dristan Cold and other drugs that use acetaminophen.

Recently, an article from Seeking Alpha has got me scratching my head! The title: "Santarus: Business Fundamentals Improving", which was written by an analyst from Zack's Research. The article highlighted recent additions to Santarus's business plan through the in-licensing of: Glumetza, Budenoside, and Rifamycin. Furthermore, the article suggested that these additions are net positive since little-to-no changes are needed in existing infrastructure.

For a minute, let's talk about what 'fundamental' is for Santurus (SNTS). Fundamental is continued success with prescription Zegerid. The reason why the stock price is where it is today, is because of the use-patent in question. The day that Santarus received the ANDA from Par (PRX), the stock price dropped from $5 to the $2's. ¡Mamma Mia!

This company's flagship and only chance for continued success is prescription Zegerid, Period! Although the Markman hearing was in favor of Santarus, 'use patents' are relatively difficult to protect in court compared to patents with New Chemical Entities. Furthermore, the fundamental concept of adding a buffer to a proton pump inhibitor, is medically simple.

DepoMed’s (DEPO) two Phase III trials for vasomotor symptoms ("hot flashes") ended in March 2009 and April 2009. The neuropathic pain trial ("PHN") was completed in May 2009. The results for all three trials will be released in late September or early October 2009.

Neuropathic pain and vasomotor symptoms, represent huge respective markets. Sales for Neurontin and Lyrica for neuropathic pain and fibromyalgia are projected above $2 billion in 2009. Current estimates presume a hot flash market of above $3 billion. The hot flash market, compromised mainly of hormones, collapsed in 2003 due to the Women's Health Initiative ("WHI"), which demonstrated egregious adverse events associated with the incumbent therapy: Hormone Replacement Therapy.