CHTP investors still hoping FDA pulls midodrine; other catalyst on tap this month Print E-mail
By Patrick Crutcher   
Tuesday, 07 September 2010 12:09

According to published reports, officals at the FDA will continue to allow access to ProAmatine, also known as midodrine, "while the necessary data is collected and the legal issues get sorted out."  Chelsea Therapuetics'(NASDAQ:CHTP) drug, Northera is set to compete against midodrine, however the FDA still yet to make a final ruling.

CHTP and their investors are hoping the FDA eventually sides against midodrine in order for the Company to fully capitalize on this market. For now, at least, it appears federal regulators have backed off a plan to remove the Shire PLC low blood-pressure treatment from the market after warning in August that the drug has not been proven effective. Last month, the FDA proposed withdrawing the drug from the market.

Chelsea Therapuetics is currently completing work on Study 301 for the treatment of symptomatic, neurogenic orthostatic hypotension (NOH). Their latest PR regarding the study points to a results announcement sometime this month. We've noted that during their presentation for Wedbush in early August, the analyst covering CHTP, Liana Moussatos, suggests mid-to-late September. For what it is worth, Wedbush still currently has them rated as ‘Outperform’. Remember, Chelsea has said that Study 302 would have received FDA approval, if they'd been using the new endpoints. This reaffirms our belief that Study 301 will show significant results in NOH.

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CHTP’s Northera will be looking to serve more than just the US market. As CHTP outlines in the slide below, Northera has great potential beyond. Estimates of $250-375M are only based on the US market projections. This is not including the rest-of-world(ROW) rights that CHTP has on droxidopa(Northera), which includes the EU, and the added indication in patients with Parkinson’s. Clearly, the market potential for CHTP seems well over $300M and closer to $500-600M, based on the full spectrum of possibilities. Additionally, CHTP stands to benefit from Northera’s better safety profile and added efficacy in treating NOH, since it specifically targets the underlying cause of NOH.

Of significant importance is Study 306, which is a confirmatory study of symptomatic neurogenic orthostatic hypotension (NOH) associated with Parkinson's disease using Northera. Parkinson's disease (PD) is the second most common neurodegenerative disorder in America. As a result of decreased levels of norepinephrine associated with PD, approximately 20% of PD patients may experience symptomatic NOH.

The results of Study 303 reported robust efficacy of Northera in treating NOH associated with Parkinson's disease (PD). Using the patient reported CGI-S, 58% of PD patients, and 47% of the full study population, reported minimal or no orthostatic hypotension by the end of the three-month treatment period, compared with 3% and 1% respectively at baseline. CHTP is wisely trying to have the added on indication for Parkinson’s which effects roughly 500,000 to 1 million people in the US.

According to a new "insider buy" report from GuruFocus, Simon Pedder the CEO of Chelsea Therapeutics has recently purchased more shares of the company: 1,250 shares of CHTP on 09/02/2010 at an average price of $4.08 a share. Other recent insider trades include:

 Vice President of Operations Joseph Oliveto bought 3,500 shares of CHTP stock on 08/12/2010 at the average price of 2.87. Joseph Oliveto owns at least 3,500 shares after this. The price of the stock has increased by 41.81% since.

VP, Business Development Michael J. Roberts bought 2,000 shares of CHTP stock on 08/11/2010 at the average price of 3.1. Michael J Roberts owns at least 22,000 shares after this. The price of the stock has increased by 31.29% since.


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