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Biotech / Medical : Sepracor-Looks very promising -- Ignore unavailable to you. Want to Upgrade?

To: bazer who wrote (954)	7/2/1998 10:08:00 PM
From: Ed Ajootian	Respond to of 10280

epracor's Asthma Drug Xopenex Meets FDA Conditions Marlborough, Massachusetts, July 2 (Bloomberg) -- Sepracor Inc., which develops improved versions of widely used drugs, said U.S. regulators have indicated they will approve the asthma drug Xopenex, its first revenue-generating product. Sepracor shares rose 3 to 45 3/4. The company said it received a letter from the U.S. Food and Drug Administration saying Xopenex is ''approvable'' -- meaning the drug can be marketed once the labeling and other details are resolved with the FDA. Xopenex contains the active chemical found in racemic albuterol, one of the leading asthma treatments worldwide with sales of about $1.4 billion in 1997. The Marlborough, Massachusetts-based company improved the treatment by stripping out another isomer, or chemical compound, in albuterol that increases its side effects without boosting its effectiveness. The company is on track to launch Xopenex in the fourth quarter of 1998,'' President and Chief Executive Timothy Barberich said in a statement. Xopenex for inhalation, covered by the FDA's letter, could generate $100 million in U.S. sales, conservatively, if Sepracor sells it alone, said Mehta Parnters analyst Sergio Traversa. If the company elects to sell it in conjunction with a large pharmaceutical marketing partner, the drug sales would be much higher, although Sepracor's profits wouldn't increase as much, he said. Sales likely will increase further, to $200 million or more, as Sepracor gets approval for other versions of the drug, including a pill form, Traversa said. Glaxo, Schering-Plough The worldwide market for albuterol is dominated by Glaxo Wellcome Plc's Ventolin and Schering-Plough Corp.'s Proventil, although they're no longer protected by patent in the U.S., where Xopenex will make an impact, Traversa said. Generic versions of the chemical, which relaxes and widens the airways, are widely sold in the U.S. Asthma is an inflammation of the airways that makes breathing difficult. It affects 15 million Americans, and the number of patients is growing rapidly. Sepracor, founded in 1984, patents isomers found in drugs and separates them to determine which contribute more to effectiveness and which add more to side effects. Big drugmakers, in their eagerness to bring new products to market, often skipped the patenting of isomers during the development process. The company said in its annual report that it is reformulating brand-name drugs with sales that exceed $12 billion, including Eli Lilly & Co.'s Prozac and Schering-Plough Corp.'s Claritin. 16:15:32 07/02/1998 Any reference to the material must be properly attributed to Bloomberg News. *************************************************************************** Thanks for your thoughts. Will comment more later.

To: bazer who wrote (954)	7/2/1998 10:20:00 PM
From: Biomaven	Respond to of 10280

Good news, and earlier than I was expecting. Remember this is only a portion of the whole albuterol market, and the pill form (which seems to have slipped a little schedule wise) and the metered dose inhaler are still a ways off. From Jim Silverman's excellent report on their annual meeting: "Levalbuterol has a brand name: XopeneX. Nebule will compete in a $250MM market that is dominated by generics. They expect a premium price for XenopeX. Sepracor is currently conducting a 1,000 patient trial to show that standard albuterol (Ventolin) decreases lung function from long term usage and XopeneX does not. This is fairly interesting, as previously I was informed that they would not run head-to-head trials to confirm this. Perhaps their new cash hoard has afforded them this. Confirmatory results of levalbuterol's benefits and the potential for decreased lung function of albuterol could give Sepracor a very nice marketing angle." My view is that they wouldn't be doing this extra trial unless they were pretty damn sure of the outcome. My guess is that they will wait for the results of this trial before partnering up for the MDI version of levalbuterol, which is the big ticket item. Interesting that their brand name is unrelated to the existing albuterol names - suggests to me that they are going to try to market it not as a souped-up generic but as a new stand-alone drug. I wonder what sort of price premium they will go for? Presumably it is more expensive to make, but I have no idea if this is significant. Anyhow they are 2 for 2 now with the FDA (Allegra was their first approval). Lots more coming over the next decade... Peter

To: bazer who wrote (954)	7/5/1998 6:49:00 AM
From: Ed Ajootian	Read Replies (4) \| Respond to of 10280

Bazer, Always great to hear from folks that would be in a position to have a first-hand opinion on this stuff. I agree, this news could light a fire under this thing. The stock didn't move up any more than it did on Thursday since a lot of the fund managers had already bolted for the Holiday and none of the analysts were around I bet either. You watch, this week will see each of the analysts weigh in with reiterations of their "buy" recommendations, raising of price targets, etc., etc. But just for kicks I'd like to resurrect a counterpoint to levalburol's potential, as expressed by a pulmonoligist named Dan Root that posted a series of msgs. here about 9 months ago. Below is an excerpt from his first post, #482. Would be interested in your thoughts: "The levalbuterol is another issue. So far, as a pulmonologist, what I have seen will not make me change my prescription habits in the hospital, as the toxicity profile of albuterol is really not that bad and it is a fraction of the cost of what levalbuterol will be. Now, on the outpatient scene, a MDI with levalbuterol may be a benifit, as the duration of action is better than albuterol, with a rapid onset. However, falling inbetween the short and long acting beta aonists, it might have some difficulty finding a niche. If it is marketed well, it has a hope of capturing a decent market share. I think that the drugs that will make this company fly are its own antihistamine drugs. A good nonsedating antihistamine is good for 300 million (allegra) to over a billion a year(claritin). If SEPR's compounds are really as effective or better, then, they could easily have a multi hundred million dollar drug. This is still 2 years away. I restate that this stock will see great volitility until that time. Next time that it is in the low 20's, I am going to pick some up. Dan" ******************************************** Wonder if this guy is still waiting for SEPR to get back to the low 20's!