May 26, 2008 / 5:44 PM / 12 years ago

FDA's footdragging hurts Canada's biotech firms

TORONTO (Reuters) - Canadian biotechnology companies have joined a chorus of their global counterparts to rail against the U.S. Food and Drug Administration’s tardiness in approving new drugs.

A pharmacist counts pills in a pharmacy in Toronto, January 31, 2008. REUTERS/Mark Blinch

Products by companies such as Labopharm Inc DDS.TO and Cardiome Pharma Corp COM.TO have been delayed in the key U.S. market for months, chipping into their revenue and waylaying their plans.

The FDA has blamed a severely depleted staff and dwindling funds for the holdups in approving treatments, while it also deals with an overly cautious U.S. Congress that is keen to turn over every stone.

However, some critics say part of the problem stems from added scrutiny in the wake of the handling of the arthritis pill Vioxx, which was withdrawn by Merck & Co (MRK.N) in 2004 following a link to heart attacks.

“It’s going from the sublime to the ridiculous that programs that have cost hundreds of millions of dollars and many years to develop are being hung up by a couple of whiny bureaucrats,” said Brian Bapty, a biotechnology analyst at Raymond James Ltd, in Vancouver, British Columbia.

“The FDA is quibbling about staffing levels and funding, yet companies who are trying to get some of these drugs approved of which could sell for billions of dollars a year are being held for many months because of issues at the FDA.”

This has been a source of frustration for the companies.

“Any time that things aren’t going as quickly as possible, there is a certain level of frustration, but the reality is that we are in a regulated environment,” said Cardiome President Doug Janzen.

Cardiome is waiting to collect a $15 million milestone payment from its development partner Astellas Pharma (4503.T) when the FDA approves its Vernakalant heart drug.

In December, an arm of the FDA voted in favor of recommending that the intravenous drug be approved, but a decision for the application, first submitted in December 2006, was not given before the January 19 deadline.

“This is something of a different FDA today than it was three or four years ago,” said James Howard-Tripp, president and chief executive at Labopharm.

“What used to be very good about the FDA is that you used to get considerable clarity and very decisive decision making.”

Labopharm, which has struggled to get its once-daily version of the pain killer tramadol to market for several years, has also faced a series of delays as it tries to satisfy key data requirement requests from the FDA.

The drug agency’s drawn-out approval process has been costly for Labopharm and its development partner, Purdue Pharma LLP, Howard-Tripp said. The company expected approval in September 2006, and had prepared for its launch in both 2006 and mid-2007.

Howard-Tripp said the delays were the result of the FDA’s decision to alter data requirements midstream, and that the statistical method the FDA proposed for a new analysis of the data was different from what it previously requested.

To be sure, cooperation could facilitate the approval process, said Christopher Gallen, president and chief executive officer at Neuromed, a privately held maker of pain medicine.

By working with the FDA ahead of time and setting out the guidelines, Gallen said there were no regulatory surprises and “it’s very possible to move good, safe, effective drugs forward in a reasonably expeditious way.”

But patience isn’t a virtue for some.

Bellus Health (BLU.TO), formerly known as Neurochem, skirted the FDA process by renaming its Alzhemed Alzheimer’s Disease treatment “Vivimind” and classifying it as a “nutraceutical.”

This new branding allowed the company to avoid jumping through the same hoops required by the FDA in approving a drug.

Raymond James’ Bapty warned it was a matter of time before the multibillion-dollar biotechs reach boiling point and band together to flex their political muscle.

“It could come to a very big head. You will see tremendous influence brought to bear on the governing bodies and the politicians overseeing how the FDA gets funded,” Bapty said.

($1=$0.98 Canadian)

Reporting by Scott Anderson; Editing by Bernadette Baum

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