Biotech Stock Mailbag: Zalicus, Amarin
These AMRN holders are also less concerned about NCE status. They both believe the patents are more important and that potential Amarin acquirers won't be deterred by the lack of NCE status if their due diligence concludes the AMR101 patents can withstand legal challenge. I disagree with them on this point.
BugBunnyFun asks, "So, is Lovaza NCE? Your article should have clarified that, and what yes or no might mean for AMR101?"
Yes, GlaxoSmithKline's(GSK) Lovaza, a currently approved prescription fish-oil pill, does have NCE status. This is precisely why Amarin is at risk for not getting same for AMR101. The active "drug substance" in Lovaza covered under its NCE is ethyl EPA. This is same active "drug substance" in Amarin's AMR101.
According to FDA regulations, a new chemical entity (NCE) means "a drug that contains no active moiety that has been approved by FDA in any other application submitted under 505(b) of the act."
Active moiety? What the hell is that? It's a fancy word for the functional or active part of the drug substance. By this definition, AMR101 would not qualify for NCE status and the five years marketing exclusivity that does with it because of Lovaza. AMR101 would only be eligible for three years exclusivity.
Note: It doesn't matter that Lovaza consists of a mixture of EPA and DHA, another omega-3 fatty acid, while AMR101 is almost pure EPA.
What's the argument for NCE status of AMR101? The FDA has made exceptions to its NCE rule in the past under a "presumption in favor policy." I am unable to explain in my own words but Kurt Karst, an FDA lawyer at Hyman, Phelps & McNamara and a blogger with FDA Law Blog, outlines what this all means here.
Perhaps Jefferies analyst Thomas Wei summed it up even more succinctly in a note Wednesday:
"… senior FDA officials may ultimately trump the strict guidelines for NCE status in special circumstances, such as the case in which they want to reward extra effort to show clinical benefit, such as an outcomes study."
Recall, Amarin conducted a large and expensive, post-approval study to determine whether AMR101 provides important and significant cardiovascular benefit to patients.
Now, moving onto the fun stuff. My hate mail!