Chelsea Therapeutics' trial protocol for experimental rheumatoid arthritis drug gets FDA nod

As we told our readers last Friday, Chelsea Therapeutics International, Ltd. (Nasdaq:CHTP) was set to run higher in anticipation of FDA news.

The mid-stage trial will test the safety and efficacy of the drug CH-4051, in 250 patients against methotrexate (MTX), a common chemotherapy drug that is also used to treat autoimmune disorders like rheumatoid arthritis and psoriasis.

"Although MTX is considered the standard of care in RA, both as a monotherapy and in combination with other RA treatments, the dosing and maximal therapeutic benefit of MTX is limited by well-documented tolerability issues, long-term safety concerns and variable bioavailability," commented Dr. Simon Pedder, president and CEO of Chelsea Therapeutics. "Given that CH-4051 is metabolically stable and that all of our preclinical and clinical work suggests enhanced absorption, dramatically increased potency and improved tolerability over MTX, we believe CH-4051 will be safe and highly efficacious in a historically treatment-resistant patient population."

The stock has been climbing higher, from a fundamental standpoint, off news that the the FDA is poised to pull ProAmitine (Midodrine) from the market due to Shire (SHPGY) not conducting post-approval studies to prove that the drug has a benefit. Shire confirmed they have elected to withdraw the product effective September 30, 2010.

The withdrawal of Shire’s drug would also stop all sales of any generic version. These generic companies include Mylan Pharmaceuticals (MYL), Impax Laboratories (IPXL), and Novartis (NVS) unit Sandoz, must stop selling their generic versions of Midodrine. About 100,000 U.S. patients filled prescriptions for brand or generic forms of ProAmatine in 2009, the FDA said. Why does this matter to CHTP? With all of the competition removed, CHTP’s lead drug, Northera, will have a substantially larger market to fill, if approved. Some analysts have projected the market size for their drug to be around $200-300M.

Investors are anxiously awaiting news from CHTP’s pivotal Phase 3 trial with results due in September for their lead drug, Northera (droxidopa), for the treatment of orthostatic hypotension. Study 301 was reviewed by the U.S. Food and Drug Administration (FDA) and awarded a Special Protocol Assessment (SPA) in February 2008. The FDA subsequently confirmed that the SPA remained in effect following the protocol amendments approved by the FDA late last year, after their Study 302 did not meet the primary endpoint, yet did very well in other endpoints.

Shares of the company, which have risen over 26 percent in the last seven trading sessions, are rising again this morning. As more investors become aware of these developments, the trend should continue.

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