Greetings, neighbors. I hope you are enjoying your weekend. I'm visiting family. Had a grand plan--I'd take my notes for the week and just do the report. But I forgot to pack my notes. But this week, I don't think it matters much given the events of Thursday and Friday, so I'll talk about that. At least I managed to pack my toothbrush...
Things got exciting Thursday about noon. News came out that Avanir had agreed to supply Nuedexta to the VA for $5 million. Apparently the little survey they put together not so long ago had favorable results, and hey, how about a big order for this product?
So suddenly we have a nice chunk of cash. Short term, it staves off some recurring talk of dilution. Long term? The product, which works, gets disseminated to a significant group of patients who need it. They'll benefit and tell their friends. And their families will tell their friends. Brings, to us longs, a sense of inevitability. Go to you tube--you know the routine.
Yes, this was good. But the boost in share price (3.9% on 2.412 million volume) would mean little if N. got a limited approval from CHMP. So we were anxious for the news Friday. A label limited to MS and ALS would have been a disappointment, right OBHF? But that didn't happen. We got full broad label approval, for 2 doses, which we'll learn more about in the months to come.
Speaking of months, this needs to be mentioned: it's gonna be a while before there are revenues from Europe. The CHMP just makes recommendations. The EMA now has, I think, 72 days, to approve or not. But they almost always adopt what the CHMP advises. Still, then each country has to adopt the medication. We MAY get some revenues from EU this calendar year, but it won't be until late. So be prepared. But the hard part is done. Our march toward expanding the franchise took a big leap forward yesterday. Let's hear an obscure one from the Boys:
Thier will be 2 partners in the Eu, both with strong base sales forces ! I heard 50 milion upfront 8-12 % is possible. the partnership has 2 be signed 3 days after final approval. No doubt no significant revenues this fiscal or calender year, On to Asia the #$%$,s love this drug, very aging population !
"will be 2 partners in the Eu,"
That would be unusual.
" both with strong base sales forces ! I heard 50 milion upfront 8-12 % is possible."
So someone gave you insider information? Hard to believe.
Also $50 million upfront for a drug doing $75 million in US sales, 2 years and almost 3 months after launch?
Hello, Kel. I hope all goes well for you.
The whole point of the CHMP, and anything to do with Avanir, is sales. That's where the rubber hits the road. This week Avanir just opened up a number of new markets (separate countries in the EU). I'm also very encouraged by the VA contract. Frankly, it's a lot like how it will be in the EU.
Sir F. has been educating us on this. Marketing in Europe won't be like it is here. In the UK, for example, they have NICE. This is their central group for reviewing AND recommending medications. Once a medication is approved by NICE, that drug will sell, because it basically has the endorsement of the governing body. By the same token, we now have the VA basically endorsing Nuedexta, primarily for TBI patients. VA doctors will essentially be encouraged to prescribe it.
The way I see it, the more word spreads about Nuedexta, the better it is for sales, and for the longs.
Sir F., if I'm not getting this quite right, please correct me.
Last month, we had a delay that wasn't expected from the CHMP. I'm wondering why. Maybe the company stepped up for us. Maybe the EU medical authorities were leaning toward a liimited label, and perhaps the company said, 'give us another month. We'll give you some data we think is compelling.' I have no way of verifying this, but this may be the reason for the delay. Yes, we faithful longs had to stew for another month, but it was well worth the wait.
What's next? With approval in hand, Avanir is in a position to negotiation from a position of strength. That's what you hope for, but how often does it happen? Could it be that our management, which is maligned daily by the vertically challenged around here, has orchestrated this well?
If they have, we could be in for some fun in the months to come. All of the analysts covering Avanir have specifically excluded EU revenues in their projections. Now they'll have to adjust their figures, upward. It will take a bit of time, but the upgrades are coming.
What else? Partnership? I'd take that. But it's gonna cost any prospective partner.
The groundwork is in place. I know this report is music heavy, but hey--I'm a musician. Right now, I just feel like singing. Here's a great one from Gordon Sumner:
In closing, I'll dredge up an old inspriational. We who have toiled here for longer than makes sense, are closer to vindication than ever. Feeling strong now...
We'll have numbers next week. For now, the world is a little more full of music than usual.