Biopharmaceutical company,
Cardiome Pharma Corp.
(
CRME
), recently announced that its partner,
Merck
(
MRK
), has decided to discontinue the development of an oral
formulation of vernakalant. Merck decided to stop developing oral
vernakalant based on its assessment of the regulatory environment
and the time involved in the development process.
Merck and Cardiome were studying the candidate as a maintenance
therapy for the long term prevention of atrial fibrillation
recurrence.
Partnership Goes Back to 2009
The Merck - Cardiome agreement dates back to April 2009, when
the companies announced a collaboration and licensing deal related
to the development and commercialization of vernakalant. While
Merck Sharp and Dohme Corp. gained exclusive global rights to oral
vernakalant, Merck Sharp & Dohme (Switzerland) GmbH (another
Merck affiliate) acquired exclusive rights to the intravenous (IV)
formulation of vernakalant outside the US, Canada and Mexico. Merck
acquired North American rights as well to the IV formulation in
2011.
Merck's discontinuation of the oral formulation of vernakalant
will not affect its support for the IV formulation. The IV
formulation is approved in the EU and Latin America under the trade
name Brinavess. However, Brinavess' development path in the US has
not been smooth with the US Food and Drug Administration (FDA)
placing a clinical hold on the development program for the IV
formulation. A phase III study, ACT V, which was suspended in 2010,
was terminated later. Merck and the FDA will analyze the terminated
study - results should be out in the second quarter of 2012.
Brinavess is currently approved in 37 countries - Merck intends
to launch the product in about 30 countries throughout 2012.
Our Take
Oral vernakalant is not the first candidate to be discontinued
by Merck in the last few quarters. Last year, the company had
discontinued the development of telcagepant (treatment of acute
migraine) as well as MK-0431C (treatment of diabetes). Earlier this
year, the company discontinued the EU development program for
Zenhale (asthma). Merck's decision to discontinue the development
of oral vernakalant reflects the company's efforts to streamline
its pipeline and allocate funds across its entire portfolio.
As far as Cardiome is concerned, the discontinuation of the
development of oral vernakalant is a huge setback. The company has
a weak pipeline consisting of a few early stage projects and oral
vernakalant (phase I). With Merck dropping oral vernakalant,
Cardiome's shares were down more than 50%. Cardiome said that it
intends to cut its cash burn by almost 50% to $11 million.
We currently have Neutral recommendations on both companies,
which carry a Zacks #3 Rank (short-term ''Hold'' rating).
CARDIOME PHARMA (
CRME
): Free Stock Analysis Report
MERCK & CO INC (
MRK
): Free Stock Analysis Report
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