NeuroDerm soars on shorter clinical trials

Oded Lieberman

The share price of the Parkinsons treatment developer jumped 26%, to a market cap of $424 million.

Israeli drug company NeuroDerm(Nasdaq:NDRM), which developed a new drug delivery method and focuses on developing Parkinsons treatments has announced that after a positive meeting with the US Food and Drug Administration (FDA), it has decided to significantly shorten its clinical trial program. The company has not published the exact scope of this change, but according to the reported figures, it might be able to complete its trials and gain an approval for its products in less than one year and with an additional investment of only a few million dollars.

NeuroDerm's share responded to this announcement by soaring 26%, to a price reflecting a $424 million market cap, which makes it one of the most prominent Israeli biomed firms on Nasdaq. NeuroDerm has developed a new delivery method for Parkinson drugs - Levodopa and Carbidopa, administered via a pump injecting them subcutaneously. At present, these drugs are administered orally to patients in light-medium conditions, or by an implant inserted surgically and secreting the drugs inside the body, for patients with more severe conditions. Subcutaneous delivery using NeuroDerm's method has clinical advantages, compared with its two alternatives. So far, the FDA has demanded that companies like NeuroDerm show the effects of their drugs on Parkinson patients, compared with the effect of existing treatments. However, following the meeting, the company now estimates that it could get the FDA's approval to market its Parkinson treatment products based on bioequivalence trials, aimed at showing only that its method succeeds in bringing the same amount of the drug into the patient's bloodstream as existing methods. These are short tests, a few days for each participant, compared with trials taking a few months per participant, with a control group and long observation period.

Tests to support marketing?

NeuroDerm planned to conduct two clinical trials - a high-dosage drug trial, for patients in a severe condition, and lower dosage for light-medium condition patients. The lower dosage trial has already started, but following the meeting with the FDA, NeuroDerm has decided to terminate it. It might be renewed to support the company's marketing effort, if and when marketing approval is received. In addition, NeuroDerm has been carrying a large-scale safety trial which is expected to continue and possibly even be expanded following the meeting. Such a meeting does not constitute a signed document and it is always possible that after trials are cancelled the FDA will change its mind and again demand them. However, it seems that NeuroDerm's impression from the meeting was that this is unlikely.

It should be mentioned that the more clinical information a company brings, the easier it is to penetrate the market and convince doctors and health insurance companies to shift from existing products to the company's new product. It is possible that after it receives approval, the company will conduct further tests, for marketing purposes and in order to convince insurers to pay for the products.

NeuroDerm held its Nasdaq IPO at the end of 2014, and raised $45 million, at a price of $10 per share, which means that the share has almost doubled its price since, in contrast to most companies floated in the same period. In July 2015, it held another, $67 million, offering; investors in this offering currently make a 15% profit. According to its statements for the third quarter of 2016, NeuroDerm has $81 million in cash. The company, managed by Dr. Oded Lieberman, has so far lost $170 million.

Published by Globes [online], Israel business news - www.globes-online.com - on December 6, 2016

© Copyright of Globes Publisher Itonut (1983) Ltd. 2016

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Oded Lieberman
Oded Lieberman
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