Drug's OK may boost Nova's business

June 22, 1991|By Timothy J. Mullaney

The new drug that Nova Pharmaceutical Corp. received permission this week to sell to very ill leukemia patients is a step forward for the Baltimore-based drug firm, but it is not a major commercial breakthrough,analysts say.

Nova said Thursday that the U.S. Food and Drug Administration had approved a "treatment investigative new drug application" for Pergamid, a drug that is used to kill cancer cells in bone marrow.

Pergamid will make bone marrow transplants easier for patients who want to recycle their own bone marrow, a procedure used in more than half of all marrow transplants.

The drug kills cancer cells in marrow after it has been extracted from the body. Once the marrow is "clean," it can be transplanted back into the patient, Kira Bacon, a Nova spokeswoman, said.

In clinical studies, patients with acute myelogenous leukemia who were in their second remission and had a bone marrow transplant using Pergamid had a long-term survival rate of 40 percent, according to a Nova statement.

With conventional chemotherapy, the survival rate is 10 percent.

The FDA approval means that Pergamid can be used for the first time by patients who aren't enrolled in formal clinical studies, Ms. Bacon said.

But it is still short of the final FDA approval, called a "new drug application," that is necessary before Pergamid can be widely marketed.

Ms. Bacon said that Nova plans to file for that status for Pergamid by the end of the year.

Two stock analysts who follow Nova said that Pergamid is a nice

product but is well short of the commercial breakthrough that will push the 9-year-old drug research and development company to profitability.

"Bone marrow transplants are a very small market," said Jonathan Frank of Swiss Bank Corp. in New York. "There are only 5,000 procedures annually."

He added that the overseas market for marrow transplants has been limited because government health programs have been reluctant to pay for the expensive procedure.

"It's not a critical event for Nova," said Linda Miller, an analyst for PaineWebber Inc. in New York. "It's nice, but I wouldn't say it's going to make a major difference in the company's future."

Ms. Bacon said no decision has been made yet on what to charge for Pergamid.

The drug has been under development by a researcher at Johns Hopkins since 1982, and Nova acquired the rights to the drug in 1989. The company will have the exclusive right to sell Pergamid for seven years after the new drug application is approved, with no generic versions allowed on the market.

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