Exclusive: Egalet CFO Talks 'Hot Button' Rx Abuse-Deterrence, Pipeline And Multimillion-Dollar Financing
Egalet Corp (NASDAQ: EGLT) is a U.S.-based specialty pharmaceutical company that focus on treatments for pain and other conditions. The company is developing two late-stage product candidates, ARYMO ER and Egalet-002 using Guardian Technology.
Benzinga had the privilege of chatting with the company's chief financial officer, Stan Musial, to discuss the company's background, pipeline and financing activities.
Musial pointed out that as of January 2015, Egalet become a commercial organization through the in-licensing of OXAYDO, an immediate-release oxycodone product that has abuse discouraging characteristics. The executive also highlighted the acquisition of SPRIX, a very potent NSAID nasal delivery form of an NSAID from Luitpold Pharmaceutical The spray is designed for the management of moderate to moderately severe pain that provides analgesia at the opioid level.
Musial added that the combination of these proprietary technologies, coupled with its existing commercial infrastructure, really gives the company "comfort" that when ARYMO is approved management can "hit the ground running."
Abuse Deterrent Strategy
Musial continued that with the potential approval of ARYMO, there will be three approved abuse-deterrent formulations (ADF) of an oxy product, three approved abuse-deterrent formulations of a morphine product and three approved abuse-deterrent formulations of a hydrocodone product.
The abuse-deterrent formulation is proving to be a "hot button" issue with the U.S. Food and Drug Administration (FDA) that has made this a priority as 98 percent of the morphine products are not abuse-deterrent formulations.
Musial added that five states so far have introduced legislation to not dis-incent the abuse-deterrent formulation and there are another 18 to 20 states with similar legislation in the works.
Musial said that he hasn't observed a decline in morphine prescriptions. Oxycodone on the other hand, has seen a decrease in the number of scripts. Moreover, the company doesn't believe that the change of rescheduling of hydrocodone and CDC opiate's guidelines alters its perspective.
"So we don’t know if that’s a balloon effect, if you will, of the rescheduling of hydrocodone that now everybody has to go in every 30 days to get a refill," he said. "Some of the anecdotal things I think we’re hearing is because hydrocodone was so easily prescribed before. Now that they actually go into a physician’s office maybe the physician is making a smarter choice, meaning maybe he didn’t want to prescribe hydrocodone to begin with but it was easier because they could get refills, but now that the patient has to come in the office anyway, maybe they’re distinguishing between an oxy or a morphine or hydrocodone type patient."
Musial continued that the company can grow its market share over time through "environmental changes." Specifically, he stated it is "just a matter of time" before the market will be just ADFs — although this could occur several years from now.
"But again given that morphine is 98 percent generic, not abuse deterrent, there’s plenty of market for us to take from non-abuse deterrent forms of the drug as opposed to going head to head and up against Pfizer," he added.
Egalet recently completed $40 million in secured debt financing and the company will receive another $40 million upon approval of ARYMO. The funds will be used to ensure the commercial launch of ARYMO, continue and complete the trials associated with EG-002 and explore product line extensions for both OXAYDO and SPRIX.
Musial further stated that the company's cash will extend the company's operations until 2018 at which point it will have advanced its pipeline.
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