Two FDA Decisions Pending for Santarus (NASDAQ:SNTS)

Santarus, Inc.'s (NASDAQ:SNTS) main drug, Zegerid, is coming up on back-to-back FDA approval dates in early December.

This is the PDUFA date for Santarus’ partner Schering Plough (Merck) and is for the first over-the-counter (OTC) version of Zegerid branded omeprazole with sodium bicarbonate in a 20mg omeprazole dose strength. This PDUFA date is the second time around for Schering Plough; a response to a January complete response letter, and should therefore have a good chance of approval this time. An approval of the OTC version of Zegerid will trigger a $20 million milestone payment to Santarus, and Santarus will receive low double-digit royalties on net sales of OTC Zegerid.

The OTC version of Zegerid through the partnership will make Zegerid a household name, just like Prilosec and other current drugs for the indication. Schering Plough’s marketing will include direct-to-patient advertising through regular media outlets, and the impact of this should be very positive for the prescription Zegerid products currently marketed and sold by Santarus.

When a patient asks the physician about a drug by name, the physician has a strong tendency to prescribe it rather than spending valuable time explaining why another drug should be used – this is the bottom line of direct-to-patient advertising. As Santarus is currently a profitable company without these events, the impact of both to the already stellar performance of this company will have analysts make drastic changes to upcoming quarterly estimates. We are already seeing adjustments in estimates after the surprisingly good third quarter without accounting for these upcoming catalysts. With annual revenue of $150 million, Santarus iscurrently undervalued with a market capitalization of just $225 million.

The BioMedReports.com FDA Calendar service includes a database with over 400 entries of (1) pending new drug, biological agent, or medical device new product decisions at the FDA (e.g. NDA, BLA, 510k, PMA, sNDA, and sBLA filings); (2) pending new submissions to the FDA; (3) pending complete response letter (CRL) re-submissions to the FDA; and (4) pending clinical trial results.

Disclosure: Long SNTS

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