We have a statement that NEU is “initiating development of trofinetide for Fragile X-associated tremor/ataxia syndrome (FXTAS) in H2 2017”.
That’s in addition to the confirmation that, in preparation for the Phase 3 trial in Rett, NEU will conclude optimization of API manufacturing process for commercial supply of trofinetide, conclude drug formulation stability testing and analytical validation and conduct a 6 month toxicity study in a second species.
All of which, of course, will require not-insignificant funds…. yet, there is no mention of where the money is coming from.
Phase 3 discussions with the FDA, we are told, are expected to take place in Q3.
What to make from all this?
I think the following excerpt, which comes from a biotech partnering and finance advisory firm blog, provides insight into how the crucial period leading into the Phase 3 discussions meeting with the FDA can be used by a partner-seeking biotech to maximum effect…
During the partnering process for one of our recent deals for a Phase 2 program, our client (a private biotech) was preparing for an EOP2 meeting with FDA…..these meetings are momentous events to both sell-side biotech and buy-side pharma companies, as their outcome defines and clarifies the development path forward through Phase 3 to submit an application for US marketing approval. Though official “meeting minutes” are the final tangible product from an EOP2 meeting, neither the tone nor engagement of regulators is adequately captured in the minutes. The only true way to evaluate and understand what “actually happened” is to attend these meetings in-person. It goes without saying, but I’ll say it anyway, that body language, posture, and enthusiasm (or lack thereof) must be seen to be believed.
As you would expect, all potential buy-side pharma partners for this Phase 2 program were interested in the upcoming EOP2 meeting, but from two very different perspectives. The first, a more conservative view, was that if we (partners) were going to in-license the candidate and bring it through to approval, for what specific development program and associated cost would we be committing our organization? So, we (partners) will wait until after the EOP2 meeting before we can proceed to submit a term sheet for a potential deal. The second, a more aggressive view, was that if we (partners) were going to in-license this candidate and bring it through to approval, then we need a seat at the table at the EOP2 meeting so that we can participate in discussions with FDA to help shape and influence the path to marketing approval.
With the upcoming EOP2 meeting providing a critical regulatory milestone during the partnering process, we capitalized on the event with potential partners who had adopted the aggressive view, and kindly informed those companies who had been doing diligence that, “if they’d like a seat at the table for the EOP2 meeting with FDA, then term sheets are due by X date, and full contract must be executed by Y date”. This strategy put us in the very fortunate and enviable position of negotiating term sheets and contracts in parallel with three pharma partners along a very aggressive timeline (< 1 month). In the end, the final contract was executed just 12 hours prior to (the night before) the EOP2 meeting. Remember, passage of time will kill your deal, but utilizing milestone events during partnering can accelerate deal discussions dramatically. Pharma can move quickly when the situation requires it.
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