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Regulators Accept Avanir’s New-Drug Application

Aliso Viejo-based Avanir Pharmaceuticals Inc. wrapped up last month in a busy fashion.

The drug maker said March 26 that the Food and Drug Administration accepted a new-drug application for its AVP-825, which the company refers to as a “breath-powered investigational drug-device combination product for the acute treatment of migraine.”

Avanir said in a news release that the FDA’s acceptance of the new-drug application indicated it was sufficiently complete to permit a substantive review. Regulators have set a Nov. 26 goal for completing the review.

AVP-825 is made up of low-dose sumatriptan powder that’s delivered through a patient’s nose. The company said the device used to deliver the drug is activated by the user’s breath in order to propel it deep into the nasal cavity, “where absorption is more efficient and consistent than through most other routes.”

Avanir noted that the device closes the user’s soft palate, helping to prevent swallowing or inhalation of sumatriptan into the lungs.

The drug maker, which posted a loss of about $75.5 million on $7.2 million in its most recent fiscal year, got the rights to the sumatriptan-delivering technology in July when it signed a deal with Yardley, Pa.-based OptiNose USA Inc. that could eventually be worth $110 million, including milestone payments.

Avanir’s primary drug is Nuedexta, whose revenue increased 91% year-over-year for the 12 months ended on Sept. 30. Nuedexta is used to treat pseudobulbar affect, which causes fits of uncontrollable laughing and crying.

The drug maker released clinical trial news on another drug candidate prior to the FDA announcement about the AVP-825 application. It showed study data that revealed dextromethorphan, one of Nuedexta’s active ingredients, had antidepressant-like effects on subjects. Those findings were published in medical journal PLOS ONE.

“The study is the first to show that dextromethorphan has anti-depressant like effects in an in vivo model,” said Dr. Joao Siffert, Avanir’s chief medical officer.

Study data “support our belief that dextromethorphan should be further explored as an antidepressant drug and we look forward to initiating a phase II development program with our investigational drug AVP-786 in treatment resistant depression later this year,” Siffert said.

The AVP-786 drug candidate is made up of deuterium-modified dextromethorphan and quinidine. It’s being developed for treating neurologic and psychiatric disorders.


Alliance Boss Discusses Outsourcing

Alliance HealthCare Services Inc., a Newport Beach-based medical imaging provider, is starting to set expectations for what it refers to as its “traction” phase, according to Chief Executive Percy “Tom” Tomlinson.

The company provides doctors and hospitals with scanning services such as MRI and diagnostic imaging. It also runs radiation treatment facilities for cancer patients.

Outsourcing is part of the traction phase, Tomlinson recently said on an earnings call.

“Our goal is to become the outsourced partner-of-choice for hospitals looking to enhance the performance of their radiology department, whether inpatient or outpatient,” he said. “A recent survey … on healthcare [illustrates] that hospital outsourcing is at an all-time high and 88% of those that outsource [cite] the expertise of the outsourced partner as the driver of [the] decision.”

The traction phase also will include deals Tomlinson called “consultative” in nature, with a goal of helping providers improve their operating efficiency, among other things.

“By way of example, we recently signed a letter of intent with one of the largest hospital management organizations. In that letter of intent (we) outlined the joint strategy for owning and operating numerous multimodality radiology clinics within the [service] area of a number of their hospitals,” he said.

Alliance is planning to use its “historical strengths” of market leadership and a hospital-centered business model “in order to drive improved sales performance in the mobile and supplemental service segments and to be the outsource partner-of-choice with the radiology service line,” Tomlinson said.

The company’s shares shot up some 300% last year as it executed a turnaround. Shares are up 29% so far this year, with a late March market value of $353 million.

Tomlinson became Alliance’s chief executive in October, replacing Alliance Chairman Larry Buckelew, who had served as interim CEO since Paul Viviano’s May 2012 departure to run the University of California, San Diego Health System.

Alliance had been facing turbulence in recent years. It started with the recession, which brought a combination of higher unemployment among patients and reduced office visits, along with closer insurer scrutiny and higher patient deductibles and co-payments for services.

The imaging provider also had to deal with its top executive’s departure and restructuring itself.

Bits and Pieces

Michael Mussallem, chief executive of Irvine-based Edwards Lifesciences Corp., is serving as chairman of the ethics and healthcare compliance committee of Washington, D.C.-based trade group AdvaMed’s board. … Irvine-based CorVel Corp. said it received an award from Business Insurance, a trade magazine. CorVel, which works with health plans and employers to keep a lid on workers’ compensation costs, said it received the award for a module in its claims system that can help identify “significant cost-drivers in pharmacy [usage] from a comprehensive analysis of bill review data.”

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