A development stage pharmaceutical company, Chelsea Therapeutics International Ltd. (NASDAQ:CHTP) is presently engaged in development of its lead molecule Northera (droxidopa) for the treatment of symptomatic Neurogenic Orthostatic Hypotension in patients with primary autonomic failure and non-diabetic autonomic neuropathy; and frequency of falls associated with Parkinson’s disease in patients with Neurogenic Orthostatic Hypotension (NOH).

The company is also engaged in the development of series of antifolates for the treatment of autoimmune disorders including inflammatory bowel disease, ankylosing spondylitis, rheumatoid arthritis, and other immunological disorders. At its current price around $3, the stock is trading close to its recent 52-week high of $3.30 with market capitalization of $208 million.

USFDA Acknowledgement of New Drug Application Submission

Earlier in July 2013 the United States Food and Drug Administration (USFDA) directed Chelsea Therapeutics regarding certain deficiencies, in its resubmitted New Drug Application (NDA) for Northera, pertaining to formatting of some of the submitted electronic datasets and statistical programs which describes methodology for generating tables and listings. However the deficiencies were largely technical and were absolutely unrelated to clinical trial proceedings, study results or its validity.

Chelsea Therapeutics recently on August 14, 2013 submitted the NDA again to the USFDA after addressing the underlying technical deficiencies and has also received the receipt of acknowledgement from the USFDA. The company announced that the final decision on the drug approval would only be known by February 2014.

How Does the ‘Orphan Drug Status’ and ‘Priority Review’ Matters?

Chelsea Therapeutics and its investors are highly concerned about FDA’s decision on Northera given the fact that the company does not have any marketed drug in its portfolio till date. FDA’s drug approval of Northera and its subsequent commercialization can certainly reward the company and its valued investors as Northera enjoys orphan drug status since 2007 and has also been accorded priority review in 2011.

Orphan drug status is usually granted to development of molecules that exhibit significant potential for the treatment of rare conditions. The orphan drug status would entitle Chelsea Therapeutics for assistance in the design of study protocol, exemption from the user fee levied by the USFDA, tax credits for the trial related expenses and most importantly it will allow market exclusivity to the company for seven years for the treatment of symptomatic NOH.

Priority review is generally accorded to drugs that offer major development in treatment or claim to address the unmet medical need especially for conditions for which no adequate therapy exists. Shire (NASDAQ: SHPG)’s ProAmatine, the only drug to treat NOH, has been withdrawn from the market given the risk that it could raise blood pressure in patients following the drug administration. Shire decided to pull the product after black-box warning rather than fulfilling the conditions requested by the USFDA.

The Northera Advantage

Droxidopa was originally developed by the Japanese Dainippon Sumitomo Pharma Co., Ltd. (TYO: 4506) and was licensed to Chelsea Therapeutics in 2006. Then made known by Chelsea Therapeutics as Northera, it is the leading drug molecule in company’s portfolio. Besides the opportunity of Northera to be the only drug for the treatment of NOH, the company also enjoys commercialization rights for the drug except for China, Japan, Korea, and Taiwan.

Investors have long known the reward potential of orphan and priority review drug companies and have boosted their investment interest for Chelsea Therapeutics as evident from 300% year to date rise in the company’s stock prices.

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