FDA accepts Acrux application for generic version of nail fungus drug Jublia

Acrux ASX ACR FDA generic onychomycosis drug Jublia US Food and Drug Administration
Jublia, an antifungal drug indicated for the topical treatment of nail infections, has annual sales in the United States exceeding US$280 million.

Pharmaceutical company Acrux (ASX: ACR) is a step closer to commercialising a topical treatment for onychomycosis in the US after this morning’s news that the US Food and Drug Administration (FDA) had accepted Acrux’ “Paragraph IV Abbreviated” new drug application (ANDA) dossier.

The acceptance means the Acrux product will be reviewed for approval by the FDA and thereby look to generate sales revenues from a market that is paying an inflated price for nail care.

Jublia is FDA-approved and is used to for topical treatment of onychomycosis, also known as “tinea unguium”. The treatment currently costs around US$1,500 per month on average and is currently owned and distributed by US pharmaceutical company Valeant Pharmaceuticals.

Acrux hopes to produce a bioequivalent version and market a generic version of the drug to patients but must wait for the FDA to give full approval for its generic drug application.

Nail care

Onychomycosis is a fungal infection of toenails that can result in thickening and yellowing of the nail. In severe cases, the infection can lead to the nail being separated from the toe altogether, creating additional discomfort and healthcare problems for patients.

The common fungal infection is closely correlated with age – occurring in 10% of the general population, in 20% of people above the age of 60 and in 50% of those older than 70. As demographics continue to indicate an ageing US population, the potential addressable market is, therefore, expanding organically year-on-year.

In an exclusive interview, Acrux CEO Michael Kotsanis told Small Caps that “it’s been 9 years since we’ve submitted a dossier with the FDA, which is far too long. As a company, we are looking to make progress on several fronts with the topical and generic drug markets exhibiting strong potential for future growth while maintaining the company’s overall risk exposure.”

The FDA’s acceptance of the application for review represents a key milestone for Acrux, being the first of 13 generic compounds currently in the company’s pipeline to reach this stage of development.

Headstart in pharmaceutical commerce

Over the past year, US sales for Jublia reached US$283 million (A$382 million) which could mean Acrux is able to take advantage with its own generic drug once approved. Typically, generic drugs are exactly the same as their patented versions – but tend to be far cheaper and more accessible.

Today’s FDA acceptance means Acrux is able to have its dossier submission reviewed for its first-to-file application for the generic version of Jublia – and crucially – making it eligible for 180 days of generic exclusivity that could give Acrux a commercial head start compared to its peers.

Acrux is progressing a range of treatments with Mr Kotsanis confirming that the company is experiencing “continued progress” across its topical generic product portfolio. The company also said that the FDA has confirmed the submission date for Acrux’s efinaconazole topical solution, which in turn corresponds to the first date on which an ANDA could be lawfully submitted.

“We are pleased that the first product in our current pipeline of 13 generic topical products is now being reviewed by the FDA for approval. This first-to-file ‘Paragraph IV ANDA’ is the first example of our investment in our topical generic strategy and is the result of the great work by our R&D team,” said Mr Kotsanis.

Patents and generic drugs

In June 2018, Acrux submitted a Paragraph IV ANDA to seek approval from the FDA to market a generic version of Jublia in the US. The application sought to obtain rights for the generic version of Jublia before the expiration of its listed patents.

Following today’s FDA approval, Acrux is required to notify Valeant of its paragraph IV application. As the patent owner, Valeant then has 45 days to file a patent litigation suit asserting patents listed in what’s known as the Orange Book – a database of drug products approved on the basis of safety and effectiveness by the FDA including all related patent and exclusivity information.

The patent owner must make an official court filing within 45 days to initiate the litigation process under the Hatch-Waxman Act, a federal law passed in 1984 which encourages the manufacture of generic drugs.

Under the Act, drug developers can seek FDA approval to market a generic drug prior to patent expiry, by providing data demonstrating “bioequivalence”.

To seek this approval, generic applicants must provide a certification in relation to the patents purportedly protecting the original Reference Listed Drug that are listed in the Orange Book.

Mr Kotsanis explained that although he expects Valeant to defend their patents in court within the 45-day period, his position is backed up by professional legal advice that Valeant’s patents are invalid.

The onus is now on Valeant to decide whether to challenge Acrux’s move to make a generic version of Jublia, or not. These patent tussles are a regular occurrence in the US pharmaceutical market, but Acrux is confident they will prevail in any patent dispute Valeant decides to pursue.

George is an award-winning market analyst who has authored articles and editorial opinion pieces for multiple publications around the world. He has written about a wide variety of topics including financial markets, stocks, trading, politics and economics.