Cadence Pharmaceuticals, Inc. recently announced that its Ofirmev (acetaminophen) injection has been made available on the Veterans Affairs National Formulary (VANF) by the Department of Veterans Affairs (VA).
Cadence Pharma believes that the availability of Ofirmev on the VANF list confirms VA’s recognition of the clinical value of Ofirmev.
The VANF refers to a product list (drugs and supplies) which is usually covered under VA pharmacy benefits. The VANF management process aims to provide high quality pharmaceutical offerings.
The management process also strives to ensure the portability and standardization of the pharmacy benefit to all eligible veterans accepted by the VA for care.
We note that Ofirmev is Cadence Pharma’s proprietary intravenous formulation of acetaminophen. It is indicated for the management of pain with adjunctive opioid analgesics as well as for the reduction of fever.
The drug was approved by the US Food and Drug Administration (FDA) in Nov 2010 and subsequently launched in the US in Jan 2011. Sales of Ofirmev nearly tripled from the year-ago quarter to $17.1 million in the fourth quarter of 2012.
As of Dec 31, 2012, Cadence Pharma had over 3,750 unique customer accounts, up 66% from the year-ago quarter.
Cadence has sold more than $6 million vials of Ofirmev from Jan 2011 to Jan 2012.
Cadence Pharma acquired the exclusive rights to Ofirmev in the US and Canada from Bristol-Myers Squibb (BMY - Analyst Report) in 2006. The drug is marketed by Bristol-Myers as Perfalgan in Europe and other parts of the world.
Meanwhile, Cadence Pharma recently amended its supply agreement with Lawrence Laboratories, a member of the Bristol-Myers Squibb group of companies, which supplies Ofirmev to Cadence. The supply agreement has now been extended through Dec 2018.
In order to improve the sales of the drug further, Cadence is taking steps to package and thereby market the product better. Cadence entered into an agreement with Laboratorios Grifols in early Mar 2013 to supply Ofirmev in inflexible plastic bags.
Cadence Pharma expects net revenue for Ofirmev to be in the range of $94 million to $100 million in 2013, up from $50.1 million in 2012.
Cadence Pharma holds a Zacks Rank #3 (Hold). Other pharma stocks, which are well placed, include Avanir Pharmaceuticals and Furiex Pharmaceuticals . Both stocks carry a Zacks Rank #2 (Buy).