biospaceJanuary 02, 2018
Tag: 2018 , Avadel Pharma
Avadel Pharma (NASDAQ:AVDL), "Avadel" or "the Company," today announced its 2018 corporate objectives and financial expectations, including the commercial launch of Noctiva™ and the anticipated filing of a New Drug Application (NDA) for both FT218, a once-nightly formulation of sodium oxybate using Micropump®, and its fourth Unapproved Marketed Drug (UMD) product, AV001.
For 2018, the Company has set forth the following expectations:
Implement a full-scale commercial launch for Noctiva during the second quarter
File the NDA for FT218 by the end of 2018
File the NDA for AV001, its fourth UMD product
Maintain market leading position across its portfolio of hospital products and improve the effectiveness and efficiency of its pediatric operations
Enhance portfolio development through selective M&A and advancement of internal pipeline
Generate total revenues between $110 - $130 million
Mike Anderson, Avadel’s Chief Executive Officer, remarked, "We are excited to enter 2018 with a set of strategic objectives that will be transformational for our company. Achievement of these objectives moves us towards our goal of becoming a fully integrated specialty pharmaceutical company with an exceptional long-term growth trajectory. We have built a strong base business that has provided and continues to provide us cash flow, and we have laid the groundwork to invest in our future."
Mr. Anderson continued, "We not only expect to successfully complete our Phase III REST-ON trial of FT218 for excessive daytime sleepiness and cataplexy, and subsequently file our NDA by year end, but we are also gearing up for a strong commercial launch for Noctiva™ in the second quarter. Both FT218 and Noctiva are proprietary products with enormous market potential. They will expand our commercial footprint into new therapeutic categories and create meaningful long-term value for shareholders."
Clinical Operations
Avadel is progressing in enrolling patients for its REST-ON Phase III clinical trial. REST-ON is a double-blind, randomized, placebo controlled study of 264 patients to assess the efficacy and safety of FT218, a once nightly formulation of sodium oxybate for extended-release oral suspension for the treatment of excessive daytime sleepiness (EDS) and cataplexy in patients suffering from narcolepsy. FT218 uses the Company’s proprietary Micropump® drug delivery technology.
"Filing the NDA for FT218 by the end of 2018 is still our target, and strategies to drive enrollment through social media, clinical site incentive goals and identification of additional clinical sites have aided us in maintaining this objective. We recognize that enrollment is the most difficult aspect of this trial given the limited population of narcolepsy patients and the strict exclusion criteria agreed upon in our Special Protocol Assessment with FDA. The important thing is that we continue to make progress with patient enrollment and simultaneously prepare the nonclinical and CMC requirements for our NDA filing," said Mr. Anderson.
Mr. Anderson continued, "We maintain that FT218 is our most important clinical project in 2018. The opportunity to enter a possible blockbuster market with a potentially superior product is incredibly meaningful for our company. The current approved product to treat the condition generates well over $1 billion per year. Based on an independent claims analysis, there exists a large body of patients who ultimately choose not to remain on the approved twice-nightly version of sodium oxybate, with only 46% of new start patients persisting on treatment at twelve months1. The need and desire for a once-nightly product from the medical community and patients are strong, and we believe FT218 has the potential to meet these needs."
In addition to FT218, Avadel is also working to file an NDA for a fourth sterile injectable product, AV001, which is currently being marketed by another company without FDA approval. During the formulation and development work for AV001, the Company uncovered what it believes is a meaningful improvement to the product’s safety profile. AV001 is expected to compete in an estimated market size of approximately $30 - $40 million per year once launched in 2019.
Commercial Operations
Noctiva™
In September 2017, Avadel in-licensed Noctiva, the first and only FDA approved product for nocturia due to nocturnal polyuria. Nocturnal polyuria is the overproduction of urine at night and leads to the condition of nocturia, which causes patients to wake two or more times per night to void. It is estimated that nocturia affects approximately 40 million2 people in the United States and represents a large unaddressed and unmet medical need.
Greg Divis, Avadel’s Chief Commercial Officer, said, "We are making great progress in executing our launch plans for Noctiva. We have completed hiring for all key roles, including an eighty person salesforce that will be out in the field as soon as late January to begin disease state education and initiating patient experience programs across urology specialists. We remain very pleased with the continued feedback we have received from physicians, patients and payers as it relates to Noctiva. Overall, we are confident that the work we have been doing will set us up for a successful commercial launch in the second quarter."
The Company estimates that peak revenues for Noctiva could be as high as $750 million or more per year.
Hospital Products
Avadel’s three sterile injectable products, Akovaz® (ephedrine sulfate), Bloxiverz® (neostigmine methylsulfate) and Vazculep® (phenylephrine hydrochloride), ended 2017 as market share leaders for each of their respective categories. Akovaz and Bloxiverz were both subject to additional generic competitors late in the second half of 2017, and the Company expects increased pressure on both share and price as a result in 2018. Avadel remains committed to maintaining market leadership across its hospital products during 2018.
Mr. Divis said, "These hospital products were developed to provide the company with cash flow and they have exceeded our expectations. Despite the increasingly competitive environment for these generics, we have continued to maintain market leadership and strong gross margins across our portfolio, and we fully anticipate that these products will continue to be valuable assets to our company."
Pediatric Products
Avadel’s pediatric products showed good growth during 2017 with Karbinal ER showing especially robust growth. Recent weekly prescription trends for Karbinal ER average approximately 1,800 TRxs per week, representing greater than 200% growth over 2016. In July, Flexichamber was launched and continues to grow slowly but steadily. The company’s original plan for the pediatric business was to include additional products to add to those acquired from FSC Pediatrics. To date, the company continues to look for proprietary meaningfully differentiated products with growth potential to add into the portfolio.
2017 Outlook
The Company is reaffirming its 2017 revenue guidance to be in the range of $165 to $175 million and expects to be at the top end of its adjusted EPS guidance of $0.25 to $0.35.
2018 Financial Guidance
Due to the generic nature of its hospital business and recent increased competition, the Company expects revenues to decline on a year-over-year basis and anticipates generating between $110 - $130 million in revenues for 2018, including $10 - $20 million of Noctiva revenues. In preparation to reach its 2018 strategic objectives, the Company expects to invest heavily in both Research & Development (R&D) and Sales & Marketing. R&D costs are expected to range from $40 - $50 million, the majority of which will be incurred by the REST-ON trial and subsequent NDA filing. Selling, General & Administrative (SG&A) expense is expected to be in the range of $85 - $95 million. Included in SG&A is approximately $50 - $55 million of Selling & Marketing costs for Noctiva. Excluding these launch costs, SG&A is expected to be in the range of $35 – $40 million, down slightly from 2017. Given the revenue, R&D and SG&A spending expectations and a $20 million Noctiva launch milestone payment due by June 30, 2018, the Company expects negative cash flow in 2018. Currently, the Company has a strong balance sheet and as a matter of good corporate governance will continue to closely monitor its cash requirements and as required will take steps to ensure adequate liquidity to fund its strategic priorities. The Company is currently assessing the Tax Cuts and Jobs Act of 2017 and, accordingly, is unable to provide 2018 adjusted diluted EPS guidance; however, it does not believe it will be required to pay a significant amount of cash taxes during the year.
About Avadel Pharmaceuticals plc:
Avadel Pharmaceuticals plc (NASDAQ:AVDL) is a specialty pharmaceutical company that seeks to develop differentiated pharmaceutical products that are safe, effective and easy to take through formulation development, by utilizing its proprietary drug delivery technology and in-licensing / acquiring new products; ultimately, helping patients adhere to their prescribed medical treatment and see better results. The Company is headquartered in Dublin, Ireland with operations in St. Louis, Missouri, United States and Lyon, France. For more information, please visit www.avadel.com.
About Noctiva™
Noctiva is the first and only formulation of desmopressin acetate, a vasopressin analog, approved by the FDA for the treatment of nocturia due to nocturnal polyuria in adults who awaken at least two times per night to void. It is a proprietary low-dose formulation of desmopressin acetate administered through a patent-protected preservative-free intranasal delivery system. Noctiva is dosed as a single spray in one nostril 30 minutes before bedtime, and is approved in two dosage forms of 0.83 mcg and 1.66 mcg. Noctiva is expected to become available to patients in the second quarter of 2018.
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