Catching Catalyst Pharma by surprise, FDA approves Jacobus LEMS drug for pediatric patients — based on adult data
When Catalyst Pharmaceuticals’ drug for Lambert-Eaton myasthenic syndrome (LEMS) — a rare, autoimmune disorder that affects the connection between nerves and muscles — was approved last year, carrying a $375,000 annual price tag, some patients were not exactly thrilled. Hundreds of patients had been able to access a similar drug from compounding pharmacies for a fraction of the cost, or from a small, family-run New Jersey-based company called Jacobus Pharmaceuticals for free, as part of an FDA-ratified compassionate use program.
Once the Catalyst treatment, Firdapse, won approval for adult LEMS patients, it also won market exclusivity spanning seven years — effectively precluding Jacobus and compounding pharmacies from selling their versions.
On Monday, however, the FDA may have disrupted that status quo by approving the Jacobus version for patients aged 6 to 17, based on data from a 32 adult patient-study. The agency said it had used adult LEMS data to deduce a safe dosing regimen for pediatric patients. As far as the FDA is concerned, doctors can prescribe drugs for unapproved use, when they judge that it is medically appropriate for their patient.
Shares of Coral Gables, Florida-based Catalyst $CPRX cratered after-market on Monday. On Tuesday, the stock was down 36.5% at $3.88 before the bell.
“The approval of Jacobus’ Ruzurgi for the treatment of pediatric patients with LEMS comes as a surprise, as investors had all but written off this version of 3,4-DAP following Firdapse’s approval (for adults, who comprise nearly all of the LEMS population) under the presumption that other forms would be blocked by orphan exclusivity. With CPRX shares -43% after Monday’s close, the market appears to be factoring significant impact to Firdapse’s commercial prospects from off-label use of a (presumably cheaper) agent,” Oppenheimer analysts wrote in a note on Tuesday.
Endpoints News has contacted Jacobus for comment. Depending on how Jacobus prices its drug, Ruzurgi — insurers could be persuaded to favor it over Catalyst’s product, despite the fact that it is officially approved for only pediatric use.
According to a report by STAT, while Jacobus has not so far made a decision on pricing, the owner has suggested that the company had spent $60 million on R&D and manufacturing, and that post-approval obligations will likely cost the company another $10 million to $20 million.
The Ruzurgi formulation requires refrigeration — while the Firdapse formulation is stable at room temperature, which gives Catalyst a slight advantage over Jacobus, SunTrust Robinson Humphrey analyst Edward Nash wrote in a note on Tuesday. “However, the commercial potential for Firdapse now would be dependent on relative pricing as well as reimbursement coverage”
In LEMS patients, the body’s own immune system launches an attack on the neuromuscular junction — which connects nerves and muscles. The condition can associated with other autoimmune diseases, but tends to occurs in patients with cancer. It’s prevalence in pediatric patients is not known, but globally it is estimated to affect three per million individuals, according to the FDA.
Firdapse landed on the US market this January, and in its fourth-quarter earnings call, Catalyst said the launch was off to a strong start, with management noting minimal pushback from payers, and indicating that covered patients pay less than $10 per month out of pocket.
But the company’s list price had already triggered a tempest of criticism in patient circles and in Washington. Vermont Senator Bernie Sanders — ahead of his announcement to make a second attempt at the presidency — spotlighted Catalyst for “fleecing” taxpayers and the “immoral exploitation of patients,” underscoring the issue as yet another instance of a drug company’s “corporate greed.”
The FDA’s decision on Ruzurgi was likely influenced by pressure from Sanders, SunTrust’s Nash noted.
Catalyst chief Patrick McEnany rebutted Sander’s assertions by saying the biotech had spent “millions” testing the drug; that the company’s pricing policy is in line with ultra-orphan diseases of similar severity — and the firm is doing its utmost to limit patients’ out of pocket cost; as well as downplayed Jacobus’ free supply, saying it was benefitting not more than a few hundred US patients.
The company declined to comment on the Jacobus approval.