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Update on BioSpecifics/ Auxilium's Xiaflex

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Investors eagerly wait for updates on the pipelines of biopharma/biotech companies. Such updates including label expansions of marketed products help them to decide whether or not to invest in a particular company. Pipeline updates provide information on experimental drugs and also provide an insight into the commercial potential of the candidate once it is successfully developed and commercialized.

BioSpecifics Technologies Corp. (BSTC - Free Report) which has been actively developing its pipeline announced mixed top-line data from a phase II study (Chien-804) which is evaluating the efficacy of Xiaflex (collagenase clostridium histolyticum) in 37 canines with benign subcutaneous lipomas.

We note Xiaflex has been in-licensed by Auxilium Pharmaceuticals, Inc. from BioSpecifics Technologies and is approved in the U.S. and EU (EU trade name: Xiapex) for Dupuytren’s Contracture (DC). Xiaflex is also approved for treating Peyronie’s disease (PD) in men with a palpable plaque and a curvature deformity of 30 degrees or greater at the start of therapy.

BioSpecifics Technologies said in its press release that the placebo-controlled, double-blind, randomized trial failed to meet its primary endpoint of a statistically significant difference (post-treatment) in the mean percentage change in lipoma volume measured by CT scan.

Data from the study however revealed a statistically significant reduction in lipoma surface area in responder analysis (measured by caliper). BioSpecifics Technologies intends to submit a final report on the study to Auxilium by Mar 31, 2014. The submission will trigger the 120-day opt-in period as Auxilium has the option to exclusively license development and marketing rights to the canine lipoma indication. The rights will go back to BioSpecifics Technologies in the event of Auxilium not opting-in.

BioSpecifics Technologies was also in the news recently when Auxilium dosed its first patient for the phase II study on Xiaflex for the treatment of frozen shoulder syndrome (FSS or adhesive capsulitis). We believe investor focus will remain on the efforts to expand Xiaflex’s label.

BioSpecifics Technologies, a biopharmaceutical company, carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the biopharma space are Jazz Pharmaceuticals (JAZZ - Free Report) and Vanda Pharmaceuticals Inc. (VNDA - Free Report) . Both stocks carry a Zacks Rank #1 (Strong Buy).

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