(CHTP) Chelsea Therapeutics International Shows Encouraging News

Chelsea Therapeutics International Ltd. (CHTP) recently announced that it received written guidance from the Director of the Office of New Drugs at the US Food and Drug Administration (FDA) regarding the resubmission of the New Drug Application (NDA) for Northera (droxidopa).

The written guidance stated that Chelsea Therapeutics’ results from Study 306B can be used as the basis for the resubmission of the Northera NDA to the FDA for the potential treatment of symptomatic neurogenic orthostatic hypotension (NOH).

Chelsea Therapeutics’ stock prices shot up approximately 152% on the news.

The news is encouraging for the company. On the basis of the FDA’s response Chelsea Therapeutics now plans to resubmit the NDA for Northera towards the end of the second quarter of 2013. If the NDA is accepted by the Division of Cardiovascular and Renal Products (DCRP), Northera will be reviewed for a period of six months. Chelsea Therapeutics expects that the candidate will be approved by the end of the year.

In Dec 2012, Chelsea Therapeutics had announced positive results from the phase III Study 306B. The study evaluated the safety and efficacy of Northera for the treatment of symptomatic NOH associated with Parkinson’s disease (PD). Results from the study revealed that patients who were treated with Northera showed significant improvements in dizziness/lightheadedness at week 1 compared to that of placebo.

In Mar 2012, Chelsea Therapeutics had received a complete response letter (CRL) from the FDA regarding the NDA for Northera, which was initially submitted in Sep 2011. Later, in Jul 2012, the FDA had advised the company to modify Study 306B to support its application for approval of Northera.

The company also expects to initiate a new clinical trial by the end of the year to verify the durability of effect of Northera in a post-marketing study.

Chelsea Therapeutics currently has no approved products. Northera is the lead investigational candidate at the company. We remain concerned about the company’s dependence on Northera for success. A second CRL could be a huge setback for the company. We expect investor focus to stay on the regulatory status of Northera.

We note that companies like Teva Pharmaceutical Industries Limited (TEVA) also have products for the treatment of PD.

Chelsea Therapeutics currently carries a Zacks Rank #3 (Hold). Other pharma stocks such as BioDelivery Sciences International Inc. (BDSI) and Cempra, Inc. (CEMP) carry a Zacks Rank #2 (Buy).
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