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UPDATE 2-Labopharm satisfies FDA concerns, shares soar

* Drugmaker satisfies all FDA manufacturing concerns

* Analyst sees approval in early 2010

* Labopharm shares up 31 percent to C$1.90 (Adds details and updates stock price.)

TORONTO, Oct 7 (Reuters) - Labopharm Inc's DDS.TO shares soared on Wednesday after the small Canadian drugmaker said all U.S. FDA concerns about the manufacturing process for its once-daily depression treatment Trazodone had been resolved, clearing the way for U.S. approval early next year.

The Montreal-based company said Italy’s Gruppo Angelini, which makes the active ingredient for the drug, had resolved problems the U.S. Food and Drug Administration had found in its manufacturing process.

Labopharm’s shares were up 31 percent at C$1.90 on the Toronto Stock Exchange late on Wednesday morning after touching as high as C$2.01 earlier in the day.

In July, the FDA told the company in a letter that the treatment would not be approved until all its concerns were satisfied.

Labopharm did not specify what the deficiencies were, but said the issues were raised following an inspection at the Italian facility. It said no efficacy or safety issues about the drug were raised.

“This was the only issue that was identified by the FDA,” said Neil Maruoka, a biotechnology analyst at Canaccord Adams. “The fact that they are able to clear this up and the FDA has confirmed that, essentially removes regulatory risk from the product and I expect that there is a high likelihood of approval.”

The FDA in its letter to Angelini said the supplier had appropriately addressed all the issues cited by regulators after an inspection earlier this year and that Angelini’s manufacturing facility has been classified as acceptable, Labopharm said on Wednesday.

Labopharm’s Trazodone is currently under FDA regulatory review with an approval date set for Feb. 11, 2010.

$1=$1.06 Canadian Reporting by Scott Anderson; Additional reporting by Anuradha Ramanathan in Bangalore; editing by Peter Galloway

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