An FDA Decision Is on the MAP

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It took a little while -- nearly seven months -- but MAP Pharmaceuticals (Nasdaq: MAPP  ) has finally resubmitted its Food and Drug Administration application for its migraine treatment Levadex.

The company received a complete response letter back in March, but the only major issue was with manufacturing of the inhaled drug. The FDA also hadn't had a chance to look a MAP's usability study. All in all, they were pretty minor issues compared with getting rejected over concerns with efficacy or safety, which can keep a drug off the market forever.

The question now is whether the resubmission will be deemed a Class 1 or Class 2 response by the FDA. The only difference is how long the FDA gives itself -- two months or six months, respectively -- to review the updated application. Given how long it took the company to put together the necessary information to satisfy the FDA, it seems a foregone conclusion that the resubmission will be given the longer Class 2 designation, putting an approval decision in April of next year.

Manufacturing issues are a black box for investors. Companies issue press releases for clinical trial results and present the data at scientific meetings, but we get very little information about a drug's manufacturing, which makes it hard to spot potential problems and predict whether MAP has satisfied the FDA this time around. It took Discovery Laboratories (Nasdaq: DSCO  ) five attempts before it finally convinced the FDA to approve Surfaxin.

The usability study seems straightforward, but the FDA will likely be overly cautious about confirming that patients can use the inhaler properly. Drugs delivered via the lungs -- especially for diseases that don't affect the lungs -- have run into safety issues. Pfizer's (NYSE: PFE  ) inhaled insulin Exubera -- which it licensed from Nektar Therapeutics (Nasdaq: NKTR  )  -- might have increased the risk of lung cancer. And the FDA rejected Alexza Pharmaceuticals' (Nasdaq: ALXA  ) inhaled antipsychotic Adasuve Staccato on worries that it decreased lung function.

The added round of scrutiny also opens MAP up to additional review of the rest of its data. That won't necessarily happen -- the FDA might stick to the manufacturing and usability issues -- but it's certainly a possibility. The FDA surprised Amylin Pharmaceuticals with the requirement of a new clinical trial during a second review for minor issues.

The unknowns create some risk, but I like the risk-reward ratio with MAP trading lower than it was before the rejection in March, providing some upside from here.

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Fool contributor Brian Orelli has no positions in the stocks mentioned above. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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