3 FDA Actions to Focus on in January

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There is no such thing as a "break" for the Food and Drug Administration, with literally hundreds of companies filing for new drug applications, supplemental new drug applications, investigational new drug applications, and literally a handful of other special protocol year-round. But, in comparative terms, January will be a bit slower of a month when it comes to PDUFA decisions and FDA panel reviews than December.

That doesn't, however, mean that there are any less important decisions being made this month than last month. That being said, here are the three FDA actions you should be focused on in January.

Dapagliflozin -- PDUFA date 01/11/2014
Perhaps no approval decision or panel review will be more exciting than AstraZeneca (NYSE: AZN  ) and Bristol-Myers Squibb's (NYSE: BMY  ) dapagliflozin, an SGLT2 inhibitor to treat type 2 diabetes, which is scheduled to receive a thumbs-up or thumbs-down from the FDA by Jan. 11.

This is actually a new drug application resubmission for AstraZeneca and Bristol-Myers' dapagliflozin, which received a complete response letter in January 2012 that requested more clinical data and raised concerns regarding the risk for elevated risk of bladder and breast cancer. With those safety trials now complete and dapagliflozin demonstrating no increased risks or adverse effects relative to the placebo, AstraZeneca and Bristol-Myers are hoping for an approval.

Just two weeks ago the FDA's advisory panel appeared to agree with the two pharmaceutical giants, recommending an approval and noting that the benefits of the type 2 diabetes drug outweighed the risks by a vote of 13-1 while also favoring its cardiovascular risk profile by a vote of 10-4. Understandably, the FDA isn't required to follow the advice of its panel, but it often does. In addition, with Johnson & Johnson's (NYSE: JNJ  ) Invokana, also an SGLT2 inhibitor, approved earlier this year, the FDA is more likely to lean in dapagliflozin's favor than at any time in the past.

The other unfolding scenario worth watching here is Bristol-Myers' sale of its diabetes division to AstraZeneca -- that includes dapagliflozin, as well as Byetta, Bydureon, and Onglyza -- for $2.7 billion, as well as the potential to earn $1.4 billion in milestone payments and royalties. The approval of dapagliflozin would be one important step to netting Bristol-Myers a decent return on its sale via milestone and royalty payments and would undoubtedly be a big positive for AstraZeneca. 

Northera -- FDA panel review 01/14/2014
If you enjoy drugs that have make-or-break potential for a company, then Chelsea Therapeutics' (NASDAQ: CHTP  )  northera should really be on your list.

Northera, a treatment for symptomatic neurogenic orthostatic hypotension in patients with primary automatic failure, is very similar to dapagliflozin in that it's back with a resubmitted NDA after receiving a complete response letter in late March 2012. That CRL from the FDA requested that it run a confirmatory trial to support the positive outcome of Study 301, and said it would need additional bioequivalence work to support a 300 mg capsule.

As expected, northera's confirmatory study (306B), which was comprised primarily of additional data from existing trials thanks to a change of heart by the FDA, demonstrated a similar efficacy in reducing lightheadedness and dizziness in its expanded study as it did in Study 301 within the first week. The big question will be whether or not northera's effectiveness proves significant enough to sway the panel after eight weeks of treatment. While it did reduce lightheadedness and dizziness at the eight-week mark, the p-value (i.e. the probability value that "chance" was involved in the results) was notably higher and could be a concern for the panel. 

The gamble for investors here is that Chelsea's entire pipeline is pretty much northera or bust, making it a poor option for investors who are unwilling to take on all-or-nothing type risk. Needless to say, the Jan. 14 FDA panel meeting promises to be a big day for Chelsea one way or another.

Hetlioz -- PDUFA date 01/31/2014
If Vanda Pharmaceuticals' (NASDAQ: VNDA  ) one-year stock chart were a roller-coaster ride at an amusement park, it might win first place for scariest attraction.

The company can attribute much of its recent success to Hetlioz (formerly tasimelteon), its non-24-hour drug designed to help totally blind people regulate their sleep habits. Whereas the majority of us use the sun as our natural meridian marker that tells us when to sleep (unless you're a vampire, of course), people who are blind have no marker to use and thus have unregulated sleeping habits. Hetlioz is expected to normalize those sleeping habits.

In mid-November the FDA's advisory panel voted overwhelmingly to recommend approval of Hetlioz as a non-24-hour drug (which would make it the first of its kind), finding that it met its primary endpoint in trials and adequately demonstrated that the drug was safe. While dapagliflozin appears to be the more exciting approval possibility, Hetlioz appears to be the drug with the best chance of obtaining approval in January with its Jan. 31 PDUFA decision date.

With peak sales estimates globally of $500 million, Hetlioz isn't going to turn Vanda into a superstar overnight, but it does have the potential to put Vanda back on the buyout radar.

This is the other big decision you should be following closely
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