Recently, Optimer Pharmaceuticals, Inc. (OPTR) announced the submission of the first section of a rolling New Drug Application (NDA) to the US Food and Drug Administration (FDA) for its anti-infective candidate fidaxomicin. Optimer is seeking marketing approval of the candidate for treating patients suffering from clostridium difficile infection (CDI) and for the prevention of the recurrence of the infection.
Optimer expects the submission of the rolling NDA to be completed by the year-end. Rolling NDA refers to a process used by the FDA to expedite the review of a drug intended to treat a serious or life-threatening disease. The market for the disease is characterized by a huge unmet need. Furthermore, the process allows the US regulatory agency to review sections of the NDA as and when they are submitted. Optimer intends to request the FDA to review the application on a priority basis.
The US regulatory authority generally reviews those drugs on a priority basis, which offer major advances in treating diseases having no adequate therapy. Applications for priority review designated drugs are reviewed by the FDA within six months of submission instead of the usual ten months. Consequently, if Optimer’s request for priority review is accepted by the FDA, then a decision from the US regulatory agency on fidaxomicin could be out in the second quarter of 2011.
Fidaxomicin, which was given fast track status by the FDA in 2003, is also under review in Europe for the same indication. Last month, the European Medicines Agency accepted the Marketing Authorization Application for fidaxomicin.
We note that CDI is the most common nosocomial or hospital-acquired diarrhea. CDI is a serious illness caused by infection of the inner lining of the colon by C. difficile bacteria that produces toxins resulting in inflammation, severe diarrhea and sometimes death.
Apart from fidaxomicin, Pruvel, an antibiotic currently in phase III trials for the treatment of travelers’ diarrhea (a form of infectious diarrhea), is another interesting candidate at Optimer. Although we are optimistic about the prospect of both these drugs, we are very concerned about the competition in this area. We believe the initial sales ramp for these products will be slow. Furthermore, the excessive dependence of the company on these two candidates also concerns us.
Optimer currently has a Zacks #3 Rank, which translates into a short-term Hold rating. We are also Neutral on the stock in the long term. Our Neutral stance indicates that the stock is expected to perform in line with the US equity market over the next 6+ months. We advise investors to retain the stock over the time period.