Expert Financial Analysis and Reporting

Regulatory Update

Antares announced that it has scheduled a Type A meeting with FDA for Xyosted which is intended to resolve issues that have stalled the FDA regulatory review. Antares requested the meeting on December 21, 2017 in response to a Complete Response Letter on Xyosted. The meeting will take place on February 21, 2018. The Company intends to provide an update on the outcome of the Type A meeting following receipt of the FDA generated minutes, which are typically received within thirty days of the meeting. I had thought that this meeting might occur in January so this is one month or so longer than anticipated, but  generally, this is in line with my expectations. See my note of November 9, 2018- My Hypothesis on Issues that Resulted in the CRL for Xyosted and Potential Timing of Approval.

Here is the timeline for what I think may occur:

February 18, 2018: Meeting with FDA occurs. I think that the FDA will inform Antares that there is no need for new clinical trial data for resubmission of the NDA. The only new requirement is an absolute commitment for a phase 4 post-marketing observational study.

Late March, 2018   Antares briefs investors on the outcome after reviewing minutes from the meeting. This should be bullish for the stock

April 2018 Antares resubmits the NDA.

May, 2018    FDA accepts the NDA.

If the review is classified as a class I (two month) review, the PDUFA date would July of 2018. If the review is class II (six month review), the PDUFA date would be November of 2018. In my opinion, this should be a class I review, but in dealing with the FDA there is no certainty and the agency is overworked and missing deadline after deadline. Hence, there is a very good chance for a class II review and this is my best guess.

Lipocine’s Oral Testosterone Formulation-Tlando- Is Turned Down by FDA Advisory Committee

Tlando is an oral formulation of testosterone. On January 10, 2018 an FDA advisory committee voted 13 to 6 against approving the product. The FDA does not always follow the recommendation of an AdCom, but in this situation I think it almost certainly will. Some investors are concerned that this does not bode well for Xyosted. Let me expand on why I think that this is not a negative for Xyosted.

There are a large number of injectable and gel formulations (mostly generic) currently approved. Since these approvals, the FDA has become concerned about potential side effects and obviously this concern has led to much greater scrutiny of new products. Since all of these products are intended to deliver testosterone, the effectiveness and side effects (risk/ benefit profile) of each product is determined by its concentration (variation) in the blood throughout the day. The FDA has defined a maximum level above which there is a concerning side effect risk and a minimum level below which efficacy is not acceptable. This defines the therapeutic range for all testosterone products.

The major attribute of QST is that the clinical data shows that it is markedly better than most (all) testosterone replacement products in maintaining the blood level of testosterone in the therapeutic range over the course of one week between injections. As an injectable, it also largely eliminates the issue of transference of testosterone to someone else, an issue that plagues the gel formulations which are currently the largest factors in the market.

At first glance some investors might think that an oral product like Tlando would have a dosing advantage over an injectable product. However, oral products must be metabolized by the liver before entering the blood stream which produces much greater variability in blood level concentrations than the injectable Xyosted which directly enters the blood stream. The result is that an oral product like Tlando is much more likely to produce wider swings in blood concentrations of testosterone.

Another dosing disadvantage is that Tlando requires twice a day dosing in the morning and at night with meals of high 800 to 1000 caloric intake. This is an awkward dosage form and may be a deterrent to many patients because this is not how they eat during the day. In contrast, a once a week injection with a virtually pain fee auto injector is very easy to comply with. The FDA AdCom was likely concerned that if Tlando was taken with a light meal or without eating we could see a spike in Cmax levels of testosterone in the blood which increases the potential for side effects. There is also the concern that if doses are missed, testosterone levels would be sub-therapeutic.

The compelling point about Xyosted is its ability to keep patients in the acceptable blood level range over one week with just one injection. Based on the pharmacokinetic profile shown in the registration trial, Xyosted appears to have the best PK profile of any of the gel or injectable products. It appears to be best in class and also offers once a week dosing.

Key Takeaways

1. Like most investors, I am frustrated by the delay in the approval of Xyosted.
2. I continue to believe that the delay in approval is not due to drug issues that might cause the FDA not to approve the product. The FDA is a cautious, slow moving bureaucracy that gets no credit when they approve a good drug and are crucified if they approve a bad drug. As a result, decisions that might take a month or so in the private sector can take much longer at the FDA.
3. I continue to feel that Xyosted will emerge as the best in class testosterone replacement product.
4. Xyosted is the key pipeline product for Antares, but the broad pipeline suggests to me that the stock would be a buy without Xyosted. Don’t take this as me thinking that Xyosted might not be approved.