FDA Report Card: Columbia Laboratories (CBRX) failed to win FDA advisors' favor

"Shares of Columbia Laboratories plunged more than 55% after FDA advisors voted against recommending the company's experimental drug for approval"

Columbia Laboratories Inc. and Watson Pharmaceuticals Inc. didn’t provide sufficient data that their progesterone gel reduces the risk of preterm birth, advisers to U.S. regulators said.

A Food and Drug Administration advisory panel voted 13-4 today in Silver Spring, Maryland, that the companies didn’t adequately prove the gel prevents mid-trimester births. The agency is scheduled to decide whether to approve the gel by Feb. 26 (PDUFA) and isn’t required to follow the panel’s recommendations.

Source: Bloomberg

CBRX regained more than half of its prior day's massive loss as traders placed their bets

"Columbia Laboratories (CBRX) regained more than 60% of yesterday's loss as traders eager to bet on surprise panel outcome"

Only 2 days left until the FDA panel votes on whether or not to recommend Columbia Laboratories' (CBRX) preterm birth therapy for the agency's approval. The biotech company's stock has seen wild swings ahead of the panel decision. 


Yesterday, CBRX tumbled 54% after a briefing document, usually published  3 days before the panel meeting, raised concerns over the insufficient efficacy of the experimental drug. However, as mentioned in yesterday's blog post, CBRX was due for a bounce as traders favor the bet of a surprise positive outcome coming out of this Friday's meeting. As a result, CBRX regained more than 60% of what it had lost yesterday with more than 8 times the avg volume, finishing at $1.47 as of the end of today's trading.


It should be noted that the general consensus is still negative for CBRX and there may even be a chance to purchase cheap put options going into Friday if the stock keeps ripping higher. I will be watching this closely tomorrow. Alternatively, waiting for the potential 'slide' play on Monday is always a great strategy. Feel free to follow me on Twitter (@MichaelJuan01) for trading updates. Good luck!

UPDATE: Columbia Laboratories (CBRX) dives 54% after FDA says drug doesn't work

"Columbia Laboratories Inc. (CBRX) fell the most in almost five years after U.S. regulators said the company’s progesterone gel to reduce the risk of preterm birth isn’t effective"

Columbia Labs dropped 54 percent to $1.10 at the close in New York, the biggest single-day decline since Feb. 5, 2007. Watson Pharmaceuticals Inc. (WPI), a partner on the drug, fell 6.8 percent to $57.98, the greatest single-day loss in almost three years.


“The information and data in this application do not support the efficacy of progesterone gel compared with placebo in reducing the risk of preterm births before 33 completed weeks,” Food and Drug Administration staff wrote in a Dec. 22 report released today.
The product would compete with KV Pharmaceutical Co. (KV/A)’s gel Makena, approved in February 2010. KV rose 6.2 percent to $1.89.


The FDA staff based its determination on data from narrow groups in a global study, said Amy Raskopf, a spokeswoman for Livingston, New Jersey-based Columbia Labs.


“This is a global study,” she said in a telephone interview. “It was designed as a global study. FDA agreed.”


An FDA advisory panel is set to meet Jan. 20 on Columbia Lab’s gel and weigh the risks and benefits. The agency isn’t required to follow the panel recommendations.


Not Statistically Significant
Of U.S. patients, 16.8 percent using the gel experienced preterm birth at 33 weeks of pregnancy, the endpoint the company and the agency agreed on, compared with 19.2 percent using placebo, not a statistically significant difference, FDA staff said.


“It does not appear that the applicant has identified a population of U.S. women who are likely to benefit from the use of progesterone gel to reduce their risk of preterm birth,” FDA staff wrote.


Columbia Labs said its gel was associated with a statistically significant reduction in preterm birth compared with placebo of 8.9 percent versus 15.2 percent in 465 pregnant women from 10 countries, according to a document from the company.


Preterm birth affects 10 percent to 12 percent of all pregnancies in the U.S., with an economic impact of $26 billion annually, according to the company.


The safety of Columbia Lab’s gel was similar to placebo, according to the FDA staff report. There were no maternal deaths in either the group using the gel or the placebo and the rates of fetal, neonatal and infant deaths were similar.


Source: Bloomberg


Trading Roadmap
Since the actual panel vote will not take place until Friday (1/20), there could be a bounce ahead of that date as traders bet on the possibility of a surprise positive recommendation by the FDA panel. However, this is risky and should only be pursued with extreme caution. Given the current status of the stock, playing the 'slide' on a surprise positive panel outcome would be a better strategy. Feel free to follow me on Twitter (@MichaelJuan01) for trading updates. Good luck!

UPDATE: CBRX hikes ahead of 1/20 FDA panel

CBRX has two major upcoming catalysts, one is the FDA panel (1/20) and the other is PDUFA (2/26). Like most companies facing scrutiny by the FDA panel, CBRX has gained much attention in recent days, resulting in a nice 13.7% hike in today's trading with a more than 100% increase in volume.

More significantly, Jan 2.5 call options traded at $0.6 today, representing a doubling of yesterday's closing price (see the first time call options were mentioned as a strategy to trade CBRX; at the time they were $0.3).

With only 9 trading sessions remaining, dramatic volatility is expected with CBRX and more hike may follow as more traders pour in their money after today's action. At this point, trade with extreme caution! It is not uncommon for these stocks to swing up OR down 10+% in a day for no particular reason even before the panel makes a decision. If one has no position in the stock or stock options, I would in fact wait to play the slide on CBRX. I will be watching this one closely. Feel free to follow me on Twitter (@michaeljuan01) for more trading updates. Good luck!

Columbia Laboratories (CBRX) - Novel Drug Delivery Offers Lower Risks of Preterm Birth and Improved Infant Outcomes

Summary 

• Company - Columbia Laboratories (CBRX)
• Drug candidate - PROCHIEVE® (progesterone gel)
• FDA Panel - 2012/01/20
• PDUFA - 2012/02/26

Preterm Birth in Women with Premature Cervical Shortening

Columbia's lead clinical development program is PROCHIEVE® (progesterone gel) to reduce the risk of preterm birth in women with premature cervical shortening. Preterm birth is a serious public health problem, affecting 10 to 12% of all pregnancies in the United States. The ecomomic impact of preterm birth is significant, costing more than $26 billion annually, with the average preterm infant costing approximately $52,000. A short cervical length at mid-pregnancy is the single most powerful predictor of preterm birth.

Technology

Key Ingredient

Each of Columbia’s marketed products and product candidates utilizes its bioadhesive drug delivery system (BDS) technology that differentiates Columbia from its competitors and provides a platform for numerous future applications. The key ingredient in the BDS is polycarbophil, a non-immunogenic, hypo-allergenic, bioadhesive polymer. Polycarbophil bonds to the cells of the body’s mucosal surfaces upon administration. In Columbia's vaginally-administered products, it bonds to the vaginal epithelial cells. Once in place, the BDS releases the active drug in a controlled and sustained manner until it is discharged 
upon normal cell turnover. This occurs every three to five days for the vaginal epithelium.

Formulation

Gels —The Company’s bioadhesive vaginal gels are self-administered using a patient-
friendly, pre-filled applicator. 

Chemistry

Polycarbophil is lightly cross-linked with divinyl glycol. It is a weak polyacrylic acid (pKa = 4.2) containing multiple carboxyl radicals (COO-), which are the source of its negative charges. These acid radicals permit hydrogen bonding with the cell surface. Hydrogen bonds are weak, but in the case of polycarbophil they are numerous and therefore tenacious.

Polycarbophil mimics negatively charged mucin, the glycoprotein component of mucus responsible for its attachment to underlying epithelial surfaces.

Benefits
Bioadhesive vaginal delivery of progesterone exhibits the following benefits:

• Facilitates targeted delivery of active compounds to the uterus, right where they are needed
• Avoids the local site pain, irritation and potential infection of daily compounded progesterone intramuscular injections
• Maintains low systemic levels

Pre-filled applicators make these FDA-approved products easy to use and patient-friendly, without the mess of pharmacy-compounded suppositories.

Columbia’s technology is currently being used to develop bioadhesive, vaginally-administered anesthetic, testosterone, and carbamide peroxide products to treat a variety of women’s healthcare indications.

Summary of Clinical Data

In April 2007, Columbia reported that data from a Phase III clinical trial that evaluated PROCHIEVE for the prevention of preterm birth in women with a prior preterm birth earlier than 35 weeks show a delay in cervical shortening in patients treated with PROCHIEVE versus placebo. The data further suggest a correlation between cervical length, progesterone administration, and both a reduction in the likelihood of preterm birth and an improvement in infant outcomes. The data were published in the peer-reviewed journal Ultrasound in Obstetrics & Gynecology in October 2007.

In 2008, Columbia initiated the PREGNANT (PROCHIEVE Extending GestatioN A New Therapy) study, a randomized, double-blind, placebo-controlled Phase III clinical trial evaluating PROCHIEVE to reduce the risk of preterm birth in women with a short cervical length as measured by transvaginal ultrasound at mid-pregnancy. In October 2008, Columbia announced a collaboration with the Perinatology Research Branch (PRB) of the Division of Intramural Research of the Eunice Kennedy Shriver National Institute of Child Health and Human Development (NICHD) of the National Institutes of Health (NIH), under which we amended the study protocol to reflect the addition of nine NIH sponsored sites and an increase in the number of patients from 300 to 450.

In December 2010, Columbia and Watson jointly reported positive top-line PREGNANT study results; the study was published in Ultrasound in Obstetrics & Gynecology in July 2011. The published results indicate that administration of PROCHIEVE from mid-pregnancy until term in women with a premature cervical shortening as confirmed by transvaginal ultrasound was associated with a statistically significant reduction in the rate of preterm birth at ≤32 6/7 weeks (p=0.020), the primary endpoint of the study, vs. placebo gel. Use of PROCHIEVE was associated with a 45% reduction in the incidence of preterm birth at this endpoint. Improvement in infant outcome was noted with PROCHIEVE. The incidence and profile of adverse events in patients receiving PROCHIEVE was comparable to placebo, which was as expected given the product's documented safety history. 

Source: Columbia Laboratories 

Trading map

For those unfamiliar with the hike-n-slide trading strategy, my primary strategy to trade biotech stocks, it takes advantage of the increased volatility and hyped up anticipation of a pre-scheduled event (i.e., FDA panel, clinical results release, PDUFA). Trades are made before and after the announcement of the event outcome without having to hold unjustifiable risks through the event. As such, the actual outcome of the event (i.e., positive or negative recommendation, approval or rejection) will not significantly affect the profitability of the trades - the beauty of the hike-n-slide trading strategy.

CBRX has climbed more than 15% in the past month ahead of the 1/20 FDA panel as traders broadly anticipate positive recommendations from the panelists. At $2.50, CBRX is still 72.4% lower than its 52-wk high of $4.31, which was seen after a hike in share price that initiated after the company announced positive phase III clinical trial data in Dec of 2010. As the FDA panel date approaches, CBRX is expected to hike back towards this level as trading activity picks up. A great way to trade CBRX is through call options. As of the last trading session of 2011, CBRX Jan 2.5 call was trading at $.30, meaning that the options would be in the money when CBRX trades at $2.8 ($2.5 + $.30). If the global economy remains steady, it is very likely that CBRX will be trading above $2.8 before 1/20. However, the only concern is that Jan call options expire on 1/21, a day after the panel meeting takes place on the Friday before the option expiration (OpEx) weekend. In other words, traders may not have a chance to know the results of panel votes before the options stop trading at the end of Friday's trading. This may encourage more buying of the Feb call options which of course carry a higher time premium. It is ultimately up to the individuals to decide which of the Jan or the Feb call options to go with for trading CBRX. So far, higher volume has been observed with the Jan call options compared to the Feb call options. I will make my call (no pun intended) fairly soon. Follow me on Twitter (@Michaeljuan01) for trading updates.  Good luck!