It is my belief, based on just pure science, that Zerenex is a New Chemical Entity. This is based upon the fact that the Zerenex form of ferric citrate is very different in the molecular way it was developed so as to warrant it as a NEW CHEMICAL Entity. I give all of you who question this the LORVAZA model. Not all fish oil is the same. In the case of Lorvaza the dosage delivery is so different that it is a NCE. This bear attempt to lower the price of Keryx will be flat out forgotten when Japan approves Zerenex for usage with dialysis patents and with pre dialysis patients. This will happen on this coming Monday morning. Finally if it was going to fall it would have fallen a lot further that 12.94. Look for recovery tomorrow to mid 13's.
In 1988, The FDA Select Committee on GRAS (Generally Recognized As Safe) Substances (SGOGS) reviewed ferric citrate (among other substances) under Code of Federal Regulations 21CFR184.1298 and concluded it to be a GRAS substance. So, the downside is that ferric citrate HAS been reviewed and approved by the FDA so in the purest sense, it is unlikely to get NCE designation...it is not new and is considered a food aditive and safe for consumption.
However, Keryx has indicated that they modified the structure of Zerenex to enhance solubility. The key here is whether or not the FDA will consider this modification of sufficient magnitude to be a considered a new substance. That is a tuff call. Based upon the overall structure of Zerenex they may conclude 'YES'. Based upon the structure of the active component in soluble form i.e. ferric citrate, they may conclude 'NO". The magnitude of the changes will be key. If Zerenex is a chemically hydrated form of ferric citrate, it is my personal opinion that it will be viewed by the FDA as a form of ferric citrate. Point is either way, it is not a slam dunk. An NCE does not define the novelty of the treatment but the novelty of the drug.
That is why the drop in the stock price today. Hopefully this issue will soon die down as it did once before and Keryx will return to its normal trading range.
from Propthink (Jason King), Mar 13 2013: (from seeking alpha)
"In discussing a New Chemical Entity (NCE) designation, KERX cited Ferrlecit as a comparator, an IV iron ferric gluconate compound that was able to obtain NCE when there were already two ferric dextran IV iron formulations approved. Bentsur stated, "...the sponsor was able to prove to the FDA from an inorganic chemistry perspective that Ferrlecit's physiochemical properties, mainly its high molecular weight complex structure, were critical for its improved activity as an IV iron formulation compared to the other IV iron compounds...If only ferric was the active moiety in our ferric citrate complex, how come no other oral ferric compound, or even more specifically ferric citrate compound, has ever demonstrated the phosphate binding or iron storage increases that we have?"
Good points. I have no doubt that the price will pick back up very quickly when investors realize that nothing has changed fundamentally, all of the analyst price targets remain intact, and the Zerenex story is going to have the same ending as expected---full approval in Japan, the USA, Europe, a stock price in the $20's and a likely buyout higher than that. By the way---yu still holding NWBO? I have also been adding there as the small dilution has brought the price down nicely and given the company a good cash infusion. The upcoming Piper Jaffray conference should provide some guidance also.
I took a bit of a profit with NWBO. Love the science behind the stock but not crazy about company management. I still have a position and will keep holding it but this stock is years away from being a success. I also believe that their science will be the eventual cure for ALL CANCERS. That's pretty wild and it's way down the line but this is cutting edge stuff.