Analyst On La Jolla's Hypotension Drug: We Expect Approval Next Year

Following the publication of full data from a late-stage study of La Jolla Pharmaceutical Company LJPC's LPJC-501, a proprietary formulation of angiotensin II, SunTrust Robinson Humphrey said it expects approval in 2018.

The Study And The Results

The full data from the Phase III study, dubbed ATHOS-3, of Angiotensin for treating catecholamine-resistant hypotension, or CRH, was published in the New England Journal of Medicine.

The study evaluated 344 patients and was randomized, with 321 receiving a study intervention; 163, angiotensin II; and 158, a placebo. The primary endpoint is the response in mean arterial blood, or MAP, at hour three, and among the secondary endpoints was CV Sequential Organ Failure Assessment, or SOFA, score at hour 48.

About 69.9 percent of angiotensin II patients achieved the primary endpoint versus 23.4 percent of placebo patients. On safety, too, the angiotensin II patients fared better than the placebo patients.

CRH is a life-threatening condition with distributive shock who cannot achieve target mean arterial pressure despite adequate fluid resuscitation and treatment with currently available vasopressors. Distributive shock suggests dangerously low pressure with adequate cardiac function.

Key Takeaways

Analysts Yatin Suneja and David Fang said they believe the publication of full data in the Journal four months ahead of the schedule sell side was bracing for, should soothe investor concerns regarding LJPC-501.

Outlining their key takeaways, the analysts said:

1. Given that LJPC-501 achieved the primary endpoint suggested by the FDA, the analysts believe this should suffice for an approval in last-line approval, which means where patients have no other treatment options.
2. The analysts were also impressed by LJPC-501's statistically significant improvement in the key secondary endpoint of CV SOFA score.
3. The analysts also said the inability of the treatment candidate to show an improvement in total SOFA score, a composite assessment of six organ systems, is less relevant in ATHOS-3's heterogenous patient population. This is because the drug was not expected to be effective in certain organs.

Physician's Take

Based on conversation with physician experts, SunTrust said it believes LJPC-501 hits on multiple characteristics of a successful drug, including effectiveness at improving MAP, a good safety profile, easily titratable and positive mortality benefit as supported by a statistically significant reduction in CV SOFA score.

The firm expects P&T committees to be receptive to LJPC-501's full data, given the significant unmet need.

The Potential

On the potential, the firm estimates that out of the approximately 500,000 distributive shock patients in the U.S. annually, about 200,000 CRH patients could be eligible for the drug, creating a $1 billion–$1.5 billion opportunity. Conservatively, the firm expects $500 million in peak sales for LJPC-501 in this indication, assuming a price of $5,000-$8,000.

SunTrust has a Buy rating on the shares of the company and a $57 price target.

At the time of writing, La Jolla shares were down 5.87 percent at $32.01.

Here's What Makes La Jolla Pharma A 2017 Top Pick At Chardan

La Jolla Meets ATHOS-3 Trial Endpoints, Dispels Market Controversy In The Process