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FDA Focuses on Forest Lab's Drawbacks

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A drug to treat a serious lung condition is facing major regulatory hurdles.

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The FDA is focusing on the forest, not the trees as its pulmonary-allergy advisory committee prepares to meet with Forest Laboratories (FRX) on Wednesday to discuss the company's treatment for chronic obstructive pulmonary disease, or COPD.

The committee released briefing documents on Monday discussing their opinion of roflumilast, which will be marketed as Daxas should it be approved. The drug is being submitted for the treatment of COPD, a rather awful lung condition that makes breathing difficult and is usually caused by smoking. There are 12 million people in the US who currently have the disease and the National Heart, Lung, and Blood Institute says it's likely that an additional 12 million don't know yet that they have the disease.

Forest analysts and investors have been hopeful that the drug would be approved because COPD currently has no cure and there are very few treatments for the condition that tends to get worse as time goes on.

Yet, Daxas faces some hurdles before the FDA will consider it for approval. The pulmonary-allergy advisory committee expressed concerns about the drug in briefing documents that were posted on the FDA website on Monday, causing Forest's stock to trade at almost double its normal volume.

The documents showed that the committee is worried about some safety issues with the drug as well as the effectiveness. The committee noted that three patients on the drug committed suicide, and another two attempted suicide. Neither COPD treatments currently on the market, GlaxoSmithKline's (GSK) Advair and Pfizer's (PFE) Spiriva, include warnings about suicide. It was also noted in the briefing documents that Daxas did improve lung function in patients compared to a placebo, but that the effects were "quite modest."

Forest is prepared for the somewhat bleak outlook of the panel, which will make a recommendation on approval of the drug to the FDA, but the decision will ultimately be decided by the agency in May. In January, Forest changed the proposed indication for the drug to just treat flare-ups, instead of a broader maintenance indication. The change in the labeling also included a warning about neuropsychiatric events. The briefing documents made several references to how late in the process the company attempted to make the changes. "This change of indication six months into the review period and two months prior to the advisory committee meeting is problematic because it shifts the focus of the efficacy analysis, which was based upon the original indication. Therefore, the Agency briefing package and questions focus on the originally proposed indication," said the briefing documents.

Robert W. Baird analyst Tom Russo sees Forest attempts to change the indication as an effort to present a more approvable drug to the FDA, but he believes the attempt is in vain. "FDA is having none of this so late in the game and focusing its questions/evaluation on the traditional broad indication," wrote Russo in a note to investors. "That FDA also highlights desirability of studying a broader COPD population than was done could thus also be relevant."

Russo now believes that the best-case scenario would be a delay in approval once the company proves the benefits of the treatment in the smaller population.
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