Profile: Discovery Laboratories, Inc. (DSCO.O)

Discovery Laboratories, Inc. is a biotechnology company developing surfactant replacement therapies (SRT) to treat respiratory disorders and diseases. It novel technology (KL4 Surfactant Technology) produces a synthetic, peptide-containing surfactant (KL4 Surfactant) that is structurally similar to pulmonary surfactant, a substance produced naturally in the lung and essential for survival and normal respiratory function. In addition, its capillary aerosol generating technology (Capillary Aerosolization Technology) produces a dense aerosol with a defined particle size, to deliver its aerosolized KL4 Surfactant to the deep lung. The Company focuses on developing its products, Surfaxin, Surfaxin LS and Aerosurf, to address the most significant respiratory conditions affecting pediatric populations. The Company’s programs include development of Surfaxin to address bronchopulmonary dysplasia (BPD) in premature infants and acute respiratory failure (ARF) in children, and conducting research and development with its KL4 Surfactant to potentially address cystic fibrosis (CF), acute lung injury (ALI), and other diseases associated with inflammation of the lung, such as asthma and chronic obstructive pulmonary disease (COPD).

Surfaxin, its first product based on its KL4 Surfactant Technology, if approved, will represent the synthetic, peptide-containing surfactant for use in pediatric medicine. The Company has filed with the United States Food and Drug Administration (FDA) a new drug application (NDA) for Surfaxin (lucinactant) for the prevention of respiratory distress syndrome (RDS) in premature infants. Aerosurf is its KL4 Surfactant in aerosolized form, which it is developing using its Capillary Aerosolization Technology initially to treat premature infants at risk for RDS. Premature infants with RDS are treated with surfactants that are administered by means of invasive endotracheal intubation and mechanical ventilation, procedures that frequently result in serious respiratory conditions and complications.

The Company’s NDA for Surfaxin, which it filed in April 2004, is supported by a Phase III pivotal trial (SELECT) for the prevention of RDS in premature infants. The SELECT trial enrolled 1,294 patients and was designed as a multinational, multicenter, randomized, masked, controlled, prophylaxis, event-driven, superiority trial to demonstrate the safety and efficacy of Surfaxin over Exosurf, an approved, non-protein containing synthetic surfactant. Survanta, a surfactant derived from cow lung and the surfactant used in the United States, served as a reference arm in the trial. Key trial results were assessed by an independent, blinded, adjudication committee consists of neonatologists and pediatric radiologists. This committee provided a method for assessing critical efficacy data in the trial. It also conducted a supportive, multinational, multicenter, prophylaxis, randomized, controlled, masked, Phase III clinical trial (STAR), which enrolled 252 patients and was designed as a non-inferiority trial comparing Surfaxin to Curosurf, a surfactant derived from pig lung and the surfactant used in Europe. The STAR trial demonstrated the overall safety and non-inferiority of Surfaxin compared to Curosurf.

On May 1, 2008, Discovery Laboratories, Inc. received a third approvable letter for the NDA. On October 17, 2008, the Company submitted its complete response to this approvable letter. The FDA accepted its complete response and established April 17, 2009, as its target action date to complete its review of this NDA and approve Surfaxin.

In October 2006, the Company announced preliminary results of its Phase II clinical trial for Surfaxin for the prevention and treatment of BPD, which was designed as an estimation study to evaluate the safety and potential efficacy of Surfaxin in infants at risk for BPD. The results of this trial suggest that Surfaxin may represent a therapeutic option for infants at risk for BPD.

In June 2007, the Company initiated a clinical trial to determine if restoration of surfactant with Surfaxin will improve lung function and result in a shorter duration of mechanical ventilation and stay in the neonatal intensive care units (NICU) or pediatric intensive care unit (PICU) for children up to two years of age suffering with ARF. The Phase II clinical trial is a multicenter, randomized, masked, placebo-controlled trial that compares Surfaxin to standard of care masked by a sham air control. The trial is being conducted at approximately 35-40 sites in both the Northern and Southern Hemispheres.

In September 2008, the Company’s aerosolized KL4 Surfactant was selected for a Phase IIa clinical trial in patients with CF that is being conducted as an investigator-initiated study at The University of North Carolina and is funded primarily through a grant provided by the Cystic Fibrosis Foundation. The trial is designed as a double-blind, randomized study to evaluate whether its aerosolized KL4 Surfactant is safe and well tolerated in patients with mild to moderate CF lung disease, and to assess the short-term effectiveness of its aerosolized KL4 Surfactant.

The Company competes with Chiesi Farmaceutici S.p.A., Dey Laboratories, Inc., Abbott Nutritionals, Inc. Forest Laboratories, Inc. and GlaxoSmithKline, plc.