The share of Foamix Pharmaceuticals Ltd.(Nasdaq:FOMX), which develops foam-based drugs, yesterday lost 40% of its value, following unsatisfactory results of the company's clinical trials of its leading product, designed to treat acne. Foamix conducted two simultaneous Phase III trials, which it hoped would provide a basis for obtaining US marketing approval for the product. The product was to have been Foamix's first independent product to reach the market.
Foamix's market cap is now $197 million, The company has $130 million in cash, which it raised in three financing rounds since its IPO in late 2014. Foamix's share was traded today at a 12% discount on the price in its IPO.
Each of Foamix's two identical trials involved 480 patients, comparing the use of the company's foam without antibiotics to the use of the foam containing the antibiotic. The current treatment for severe acne uses the same antibiotic administered orally.
In the first trial, the company demonstrated a significant improvement in the trial group, compared with the control group, with both a significant reduction in the number of blemishes and an increase in the number of patients who experience complete or almost complete disappearance of the blemishes - the two main goals of the trial. In the second identical trial, however, the number of blemishes was significantly reduced, but there was no significant difference in the number of patients in whom the blemishes completely disappeared.
The data hint that the product is indeed effective, but the company stated that it would have to reanalyze the data in order to determine whether they can be submitted to the US Food and Drug Administration (FDA) in order to obtain marketing approval for the product. Another possibility, which is more likely, is that the company will have to conduct another decisive trial, and wait for the new results before submitted a request for approval. This procedure is liable to delay registration of the product by at least a year, and cost an additional $10 million. It is also possible, of course, that a third trial will also be unsuccessful, making it unclear whether the product will ever reach the market. Foamix is expected to revise its complete analysis of the results and decide on its future measures within a few weeks.
Published by Globes [online], Israel Business News - www.globes-online.com - on March 28, 2017
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