Pfizer yesterday pulled the rug out from under Neurocrine's feet, sending the sleep drug indiplon back to its former owners, and causing the US biotechnology company's stock to take a dive into the depths and a 52-week low of just $13.52.
Pfizer's move was not unexpected as, earlier this week, Neurocrine said it would likely have to carry out an additional clinical trial in order to win full approval for the drug. The US Food and Drug Administration in May requested additional information on the two lower doses of indiplon, and rejected outright the higher 15mg dose, which was believed to be the most commercially viable.
Although the beleaguered firm still stands behind indiplon, and says it hopes to bring it to market “as quickly as possible,” clearly Pfizer is unwilling to take the risk.
Pfizer and Neurocrine joined forces in 2002 for the sleep drug and so the latter has benefited from extensive investment in indiplon throughout its clinical trial development. Neurocrine now intends to meet up with the drug regulators to determine what's next for indiplon, and will then look to secure another commercial partnership. But that meeting is not believed to be taking place until some time next month.
So investors have already moved on to speculate about Pfizer's next move, with suggestions it could pounce on Sepracor to fill the hole left by indiplon. The comments have helped push Sepracor's share price up almost 20% this week, from $49.51 to $56.42, as analysts forecast a tussle with Schering-Plough over a potential purchase and significant sums being touted.
It's also a boon for Sepracor to see competition for its Lunesta (eszopiclone) offering dropping away from the horizon. Investors had been concerned that Pfizer's immense marketing muscle would hinder Lunesta's performance, a fear which is clearly now receding, although there are still threats in the shape of copycat rivals to Sanofi-Aventis' top-selling sleep drug, Ambien (zolpidem), which are lurking in the shadows.
Also in the wings is Takeda's Rozerem (ramelteon), which has made a strong start in the US marketplace as the first hypnotic drug to be approved that is not classified as a scheduled drug, while Merck & Co/Lundbeck's first-in-class offering gaboxadol this week reported strong data from a Phase II study.