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The US Food and Drug Administration (FDA) recently issued a second complete response letter (CRL) for United Therapeutics Corporation’s (UTHR - Analyst Report) new drug application for oral Remodulin (treprostinil).

The company is looking to get oral Remodulin approved for the treatment of pulmonary arterial hypertension (PAH).

At the time of issuing the first CRL, the FDA had raised questions about the clinical importance of the 6 Minute Walk Distance (6MWD) effect size shown in the FREEDOM-M study, the lack of improvement in time to clinical worsening in all three phase III studies conducted with oral Remodulin, and the failure to show a statistically significant effect on 6MWD in the two FREEDOM-C studies.

United Therapeutics said that it will seek an "end of review" meeting with the FDA to discuss the latest CRL.

Our Take

The second CRL does not really come as a surprise - with no new data being provided in the re-submitted NDA, chances of gaining approval were low, in our opinion. We believe the company will need to conduct an additional trial with oral Remodulin. We expect more clarity on the situation once the company conducts a meeting with the FDA.

We note that United Therapeutics is facing a patent challenge for Remodulin injection. Sandoz is seeking approval for its generic version of Remodulin (10 mg/mL). United Therapeutics has filed a patent infringement lawsuit against Sandoz. Remodulin, the key revenue generator at United Therapeutics, accounts for almost 50% of sales.

United Therapeutics currently carries a Zacks Rank #3 (Hold). Even without oral Remodulin, the company is well-positioned in the pulmonary arterial hypertension market. Remodulin continues to look very strong in both the intravenous (IV) and subcutaneous (SC) forms.

With the approval of Adcirca and Tyvaso, United Therapeutics has a varied range of therapies available for the treatment of pulmonary arterial hypertension. We believe the company’s pulmonary arterial hypertension product portfolio will drive strong top-and bottom-line growth. However, with several companies working on bringing additional therapies to the market, competition is increasing. Moreover, generic competition in the market has increased with the entry of generic versions of Revatio.

Companies that currently look better-positioned include UCB (UCBJF), QLT Inc. (QLTI - Analyst Report) and Lannett Company, Inc. (LCI - Snapshot Report). All three are Zacks Rank #1 (Strong Buy) stocks.

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