Cadence Pharmaceuticals Inc (NASDAQ: CADX) whose drug OFIRMEV™(an intravenous formulation of acetaminophen that is currently marketed in Europe for the treatment of acute pain and fever by Bristol-Myers Squibb Company) under review at FDA received an Outperform rating on Friday from Wedbush with a price target of $12.
The firm notes that "if approved, OFIRMEV would be the only injectable non-opioid, non-NSAID pain product available in the US." Wedbush points out that the current post-operative pain market in the US is dominated by injectable opioids, specifically morphine, and that these products obviously carry significant side effects. The firm believes that OFIRMEV could launch in Q1 of next year and reach full year profitability in 2013 with peak gross revs of $465 million in 2015.
With Cadence shares currently in 8.30s, the firm's new price target implies a potential upside of about 44%.
Background on OFIRMEV's NDA: OFIRMEV™ received a complete response letter from FDA in February 2010. Cadence stated that "In the Complete Response letter, the FDA only indicated that deficiencies were observed during the FDA's facility inspection of Cadence's third party manufacturer, which was completed on February 5, 2010. The FDA did not cite any safety or efficacy issues, nor did it request any additional studies to be conducted prior to approval. "
Cadence met with FDA on April 16, which was a Type A meeting held among the FDA, Cadence, and its third party manufacturer to discuss the deficiencies outlined in the Complete Response letter related to an inspection of the facility used to manufacture OFIRMEV. After the meeting Cadence stated "We believe that last week's meeting with FDA was an important step forward to address the observations from the FDA's inspection of our third party manufacturer's facility and move toward potential approval of OFIRMEV," stated Ted Schroeder, President and CEO. "Based upon our discussions with the agency, we believe that it is appropriate to promptly resubmit the NDA for OFIRMEV and intend do so within the next 30 days."
"At the meeting, the FDA did not request any additional information related to the NDA, including any new stability studies. The agency will determine the type of resubmission (Class 1 or Class 2) and resulting review timeline (two months or six months, respectively) after the NDA is resubmitted. Cadence will continue to work with its third party manufacturer to ensure that the observations from the FDA's inspection of the manufacturing facility for OFIRMEV are resolved in a timely manner."
The NDA for OFIRMEV was resubmitted on May 4, 2010 and was assigned a new Prescription Drug User Fee Act(PDUFA) action date or FDA approval decision date of November 4, 2010.
Disclosure: Long position in CADX
