Zacks_Analysts' Blog : Good News for Cumberland Pharma - Analyst Blog

Recently, Cumberland Pharmaceuticals Inc. (CPIX) received a boost when the US Food and Drug Administration (FDA) cleared a new formulation of the company’s liver drug Acetadote. The injectable drug has been approved to counteract overdoses of acetaminophen and finds application in hospitals for preventing or reducing potential liver damage resulting from an overdose of acetaminophen.  Acetaminophen is found in many pain relief and fever-reducing drugs available over-the-counter.

A New Drug Application (NDA) seeking FDA clearance for the new formulation, which is bereft of stabilization and chelating agents and preservatives, was filed by Cumberland Pharma in October last year.  Following the approval, Cumberland Pharma intends to start activities for launching the new version of the drug immediately. The company does not intend to manufacture the currently available version, available since 2004, anymore. The shelf life of the approved version is 30 months, 6 months more than that of the version it will replace.

The approval comes close on the heels of a huge setback suffered by Cumberland Pharma when the  FDA refused to approve Acetadote for an additional indication due to insufficiency of data. The US regulatory agency declined to approve Acetadote in patients with non-acetaminophen acute liver failure and issued a complete response letter (CRL) after reviewing the supplemental New Drug Application (sNDA) submitted in March 2010.

 While issuing the CRL, the regulatory agency stated that there was insufficient evidence of efficacy in prolonging survival in patients suffering from acute liver failure. Acute liver failure is associated with a high mortality rate and liver transplantation is often needed to combat the disorder. Management at Cumberland Pharma stated that it intends to meet the FDA regarding the objections raised by the FDA.

Apart from Acetadote, the other marketed products at Cumberland Pharma are Kristalose, a prescription laxative and Caldolor (ibuprofen) for the treatment of pain and fever.

The company, which competes with players such as Hospira Inc. (HSP), carries a Zacks #4 Rank (short-term ‘Sell’ rating) following the FDA non-approval of the label expansion of Acetadote last month. However, we have a ‘Neutral’ view in the long-term and prefer to remain on the sidelines till more visibility is obtained regarding the performance of the new version of Acetadote.