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pSivida Corp.  announced that its partner Alimera Sciences Inc. (ALIM - Snapshot Report) has successfully conducted labeling discussions with the U.S. Food and Drug Administration (FDA) related to Iluvien for the treatment of Diabetic Macular Edema (DME).

The regulatory body and Alimera concurred that there is no need to conduct the Dermatologic and Ophthalmic Advisory Committee meeting for evaluating Iluvien for DME. The meeting was scheduled to take place in Jan 2014.

We note that Alimera had suffered a setback in Oct 2013 when it received the third Complete Response Letter (CRL) from the FDA. The FDA refused to approve the New Drug Application (NDA) for Iluvien in its present form. In the CRL, the FDA had indicated that results from a new study were required to be submitted along with a minimum of 12 months of follow-up for all enrolled patients. The FDA also talked about deficiencies at the manufacturing facility for Iluvien.

Alimera will respond to the CRL in the first quarter of 2014 regarding issues relating to the manufacturing facility and the latest safety data from patients in the UK and Germany.

The FDA has now indicated that new studies will not be required in connection with the FDA's review of Iluvien for DME prior to approval.

Iluvien is expected to be resubmitted in the first quarter. Once approved, pSivida will get a $25 million milestone payment from Alimera along with 20% of net profits on U.S. sales of Iluvien for DME.

pSivida’s Iluvien is approved and marketed in the UK and Germany, while in France it is slated to be launched early in 2014.

pSivida currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks include Actelion Ltd. (ALIOF - Snapshot Report) and Jazz Pharmaceuticals plc (JAZZ - Analyst Report) , each carrying a Zacks Rank #1 (Strong Buy).