Last week, Nastech Pharmaceutical (NASDAQ:NSTK) reported a net loss of $11.5 million on revenues of $5 million, ending the first quarter with just over $81 million in cash and investments. Recent activities include the completion of phase 1 development of the company's insulin nasal spray, the achievement of positive results for carbetocin nasal spray for the treatment of autism symptoms, and the completion of a $41 million stock offering in January.

Carbetocin is a long-acting, nasal spray analog of the naturally occurring hormone oxytocin, which may offer hope in alleviating the urgent, unmet medical need for an effective treatment of autism symptoms. The company has licensed the intellectual property rights from Dr. Eric Hollander, Professor and Chair of Psychiatry at Mount Sinai's School of Medicine's Seaver and New York Autism Center of Excellence, who has reported that oxytocin may be useful in the treatment of autism. The drug candidate is currently unlicensed, and successful early stage dosing trials have recently been completed.

The company is also developing a nasal spray formulation of parathyroid hormone (PTH) to treat osteoporosis in conjunction with Procter & Gamble (NYSE:PG). PTH is currently available as a once-daily injection only, and phase 1 studies have demonstrated that Nastech's nasal spray formulation achieves similar results for absorption, distribution, metabolism, and excretion parameters. A nasal spray is more patient-friendly than a stick with a needle every day.

The company also has a pending Abbreviated New Drug Application (ANDA) for its calcitonin-salmon nasal spray for osteoporosis, which is licensed to Par Pharmaceutical (NYSE:PRX). Last September, Nastech responded to the FDA's office of generic drugs' concern over potential interactions between a preservative and calcitonin in the company's formulation that could lead to allergic reactions in patients. The ANDA received a non-approvable letter in July 2006, prompting analyst downgrades and pessimism over a quick resolution to the concerns raised by the FDA. Nastech replied to the concerns by stating that no allergic reactions were observed in clinical trials and there is no evidence of an interaction between calcitonin and the preservative in its formulation.

In the treatment of diabetes, Nastech has conducted phase 1 studies for its unlicensed inhaled insulin drug candidate, with future studies aimed at increasing both the duration of effect and the amount of insulin that is absorbed. The company is also in early development stages with Amylin Pharmaceuticals (AMLN) to develop a nasal spray formulation of the diabetes drug Byetta, which cannot be given by mouth and requires multiple daily injections.

Finally, the company has an experimental nasal spray for the treatment of obesity called Peptide YY (PYY) that is currently unlicensed. PYY has completed three phase 1 studies, demonstrating that the compound is safe, well-tolerated, and has the potential to reduce caloric intake, moderate appetite, and cause weight loss in human subjects. In March 2006, Merck (NYSE:MRK) returned full rights to Nastech for the drug because of lack of effectiveness, but Nastech believes that PYY is worthy of further development in the form of studies to find an effective dosing level.

Despite some setbacks, Nastech has a deep enough pipeline of promising drug candidates delivered by the company's proprietary nasal spray delivery system to make it a good investment for patient biotech investors who are willing to stay with the company as it transitions into phase 2 development for its extensive pipeline. I expect the company to add and expand upon its existing collaborations, and continue to report positive results in future clinical trials with the advantage of a diverse range of compounds in its pipeline to mitigate risk. Also, investors should watch out for future developments in the company's RNA interference research initiatives.

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Fool contributor Mike Havrilla, R.Ph., B.S., Pharm.D., is a Rite Aid pharmacist who lives, writes, works, and enjoys running on the streets and trails in the small Pennsylvania town of Portage. He invites your comments and feedback. Mike does not have a position in any company mentioned in this article. The Fool has a disclosure policy.