I've been digging through pharmaceutical companies in the search for a perfect short term play and long term investment. I sifted through hundreds of biotechnology companies and finding a great one is hard to come by.  I have found one company in particular that has me very intrigued.

Nuvo Research Inc. (TSX:NRI) is the company I am talking about and it trades on the Toronto Stock Exchange under the symbol NRI.TO

First, an introduction of Nuvo's lead drug, from Nuvo Research's 09Q1 Report:

The Company’s lead product, Pennsaid, is used to treat the pain and symptoms associated with knee osteoarthritis (“OA”) a condition that afflicts 27 million Americans.

The drug combines the transdermal carrier DMSO with diclofenac sodium, a leading non-steroidal anti-inflammatory drug (“NSAID”), and delivers the active drug through the skin directly to the site of pain. Pennsaid is approved for sale and marketed under license and distribution agreements in Canada and several European countries.

In August of 2002, when Nuvo Research went by the name of Dimethaid, the FDA issued a non-approvable letter to them stating clinical efficiency and safety were major concerns. The FDA wanted 2 more clinical trials completed.

Between that time and 2006, they had submitted another application to the FDA for Pennsaid. They had also switched their name to Nuvo Research in this time period.

"In December 2006, the United States (“U.S.”) Food and Drug Administration (“FDA”) issued an approvable letter (“Approvable Letter”) that indicated Pennsaid is approvable subject to Nuvo satisfying certain conditions including the provision of additional nonclinical dermal safety and packaging data. None of the conditions in the Approvable Letter related to the clinical efficacy or the clinical safety of Pennsaid, which were evidenced in Nuvo’s Phase 3 trials."

That statement is the one statement that I believe will make investors of Nuvo a lot of money. It specifically states that the clinical efficacy or safety, previously a problem, are no longer a problem.

“During 2007, the Company engaged in communications with the FDA to clarify the Agency’s expectations regarding certain of its requirements in the Approvable Letter for additional information relating to Pennsaid. Based on the contents of the Approvable Letter and these clarifications, the Company completed several short-term studies (the “Short-Term Studies”). In addition, the Company concluded it must complete three (3) longer-term animal studies (the “Long-Term Studies”) to confirm the dermal and systemic safety of Pennsaid. The three Long-Term Studies are as follows:

• a six (6) month repeat dose dermal toxicity study (the “Six-Month Tox Study”);
• a twelve (12) month repeat dose dermal toxicity study (the “Twelve-Month Tox Study”); and,
• a two (2) year dermal carcinogenicity study (the “Carc Study”) preceded by a
dose finding trial (the “Carc Dosing Trial”).

The FDA confirmed in written minutes of a telephone meeting with the Company, that the Carc Study can be completed post approval, provided no safety concerns are identified in the Six-Month Tox Study or the Twelve-Month Tox Study (together the “Tox Studies”). The Company completed the Tox Studies and based upon its interpretation of the data believes there are no safety concerns such that, as per the Company’s agreement with the FDA, the Carc Study may be completed post approval.”

More studies were completed and if you refer to the FDA's most recent reason for denial (dermal safety), then you can see that Nuvo's studies were a direct response to them- 3 dermal-related studies.

February 4, 2009 - “the Company filed a complete response amendment to address all of the FDA’s concerns raised in the Approvable Letter and subsequently, the FDA set August 5, 2009 as the date pursuant to the Prescription Drug User Fee Act (the “PDUFA Date”) by which they will advise Nuvo of their decision regarding Pennsaid’s approvability; however, there is no guarantee that the FDA will complete its review in this timeframe. If approved by the FDA, Pennsaid will be permitted to be sold and marketed in the U.S. However, there can be no assurance, if or when, the FDA will approve the sale or marketing of Pennsaid in the U.S.”

A day before the 8/5/09 PDUFA date:
“During the review process, Nuvo provided the FDA with supplemental information, which the Agency determined to be a major amendment to the Pennsaid New Drug Application. As a result, the FDA has extended its action date by three months to provide time for a full review of the submission”

The new FDA date is now November 4th, 2009
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On June 16th, 2009, Nuvo announced a license agreement with Covidien.

“Nuvo said it will receive $10 million up front from Covidien and $15 million or $20 million for FDA approval of Pennsaid, depending on the drug's labeling.”

More info on Nuvo's other product, Pennsaid Plus, will be coming soon.

Disclosure: Long Nuvo Research Inc. (TSE:NRI)

BiomedReports is not paid or compensated to report news and developments about publicly traded companies. Full disclosure can be read at the bottom of / About Us / Section

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