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FDA Action Date for Salix's Relistor

Zacks Equity Research

The US Food and Drug Administration (FDA) recently accepted a supplemental New Drug Application (sNDA) filed by Salix Pharmaceuticals, Ltd. (NasdaqGS: SLXP - News) and Progenics Pharmaceuticals, Inc.  (NasdaqGM: PGNX - News) for Relistor. Salix and Progenics are looking to get Relistor approved for use in chronic non-cancer pain patients with opioid-induced constipation. The FDA has assigned an action date of April 27, 2012.

Relistor, a subcutaneous injection, is currently approved for the treatment of opioid-induced constipation in patients with advanced illness who are receiving palliative care, when response to laxative therapy has not been sufficient.

Salix-Progenics Deal Signed in Feb 2011

In order to boost its portfolio, Salix acquired worldwide (excluding Japan) rights to Relistor in Feb 2011. Relistor is approved in more than 50 countries including the US. Relistor sales came in at $16 million in 2010. Salix’s sales force started marketing the product in the US from April 2011. Second quarter 2011 sales came in at $3.5 million.

Salix is looking to drive Relistor’s sales through label expansions and focused promotion efforts. While initial focus will be on gastroenterologists, Salix intends to expand Relistor’s use among primary care physicians eventually. Salix’s presence in the gastroenterology space should increase awareness of the product.

Salix has plans to bring an oral formulation (phase III ongoing in patients with chronic, non-cancer pain; results due in late 2011/early 2012) of Relistor to market.

Neutral on Salix

We currently have a Neutral recommendation on Salix, which carries a Zacks #3 Rank (short-term Hold rating). We expect investor focus to remain on the performance of Relistor and updates on the regulatory status of Xifaxan (550 mg) for the non-constipation irritable bowel syndrome (IBS) indication.

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