Bloomberg News

NuPathe Falls After Failing to Win Migraine Patch Approval

August 30, 2011

(Updates share prices in the first two paragraphs.)

Aug. 30 (Bloomberg) -- NuPathe Inc., a maker of neurological and psychiatric medicines, fell 35 percent in New York trading after failing to win U.S. approval for the first skin patch to treat migraines.

NuPathe slid $1.40 to $2.65 at 4 p.m. on the Nasdaq Stock Market. The Food and Drug Administration requested more information about the treatment aimed at helping patients who have trouble swallowing pills because of nausea, Conshohocken, Pennsylvania-based NuPathe said today in a statement.

The sumatriptan patch, named Zelrix, was expected to produce peak annual sales of $250 million, or about 3 percent of the market for triptan migraine medications, Elliot Wilbur, an analyst with Needham & Co. in New York, wrote Aug. 16 in a note to clients. NuPathe rose 11 percent yesterday to $4.05, down from $9.61 on its first day of trading in August 2010.

“The agency acknowledged that NuPathe established the efficacy of the migraine patch in the overall migraine population,” the company said. The FDA’s response letter “primarily contained chemistry, manufacturing and safety questions, which the company believes it has, or shortly will have, sufficient data to address.”

The success of Zelrix will depend on adequate reimbursement, Wilbur wrote.

Market Limits

“The availability of numerous inexpensive generic forms of migraine therapy products could limit acceptance of Zelrix with patients and within the medical community,” he said.

The patch works by delivering sumatriptan, the most- prescribed migraine medication, through a mild electrical current. Migraine is a neurological disorder that affects about 31 million adults in the U.S., NuPathe said.

A one-year, 183-patient study on the migraine patch released in October revealed 58 percent experienced headache pain relief and 79 percent were nausea-free, the company said.

NuPathe entered into an agreement with Aspire Capital Fund to purchase as much as $30 million of the specialty drugmaker’s common stock during the next two years. Chicago-based Aspire made an initial investment of $500,000, NuPathe said in a statement Aug. 2.

The agreement “provides capital flexibility” and secures financing for a Zelrix introduction, Annabel Samimy, an analyst at Stifel Nicolaus & Co. in New York, wrote Aug. 16 in a note to clients.

--Editors: Chris Staiti, Steve Walsh

To contact the reporter on this story: Anna Edney in Washington at aedney@bloomberg.net.

To contact the editor responsible for this story: Adriel Bettelheim at abettelheim@bloomberg.net.


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