Following a teleconference with the FDA, AcelRx Pharmaceuticals (ACRX) says that a resubmission of the Zalviso New Drug Application won’t occur until the first quarter of 2015, if not later, and is now guiding for a Class 2 resubmission and 6-month turnaround. That puts a potential approval decision in late 2015. Zalviso, a patient-controlled analgesic system, was met with a Complete Response Letter (CRL) in July.
The stock is down 16%, to $5.50, as investors digest the fact that another approval decision won’t occur before late-2015, at the earliest, and that ACRX may need to raise capital in the interim. We explained why we would be cautious about AcelRx’s optimistic timelines a few months back, and outlined why there was a good chance the company would need to raise capital prior to the next PDUFA decision.
In July, FDA rejected Zalviso for reasons primarily associated with the device’s usability, as well as concerns about the proposed 24-month shelf life of the product. After the teleconference, AcelRx says they plan to submit protocol and proceed with bench testing to evaluating optical system errors. To address the risk of tablet misplacement, AcelRx will run a Human Factors Study with changes to the existing Instructions for Use. And, AcelRx will include additional stability data in the resubmission to support the proposed 24-month Zalviso shelf life. None of these come as major surprises.
Most importantly, it remains to be seen whether AcelRx can get the its next major inflection point – Zalviso approval – without another financing. The company ended the second quarter with $92.3 million in cash/equivalents and expects to end this year with $65 million. With operational expenses of $50 million in 2014 and increasing R&D costs to get Zalviso over the finish line, the company will be cutting it close. We would not be surprised to see a financing in the next 6 months.
