Stock Alert for Chelsea Therapeutics International Ltd. (CHTP)
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    Chelsea Therapeutics gets a boost from upcoming request for Northepa’s approval

    Chelsea Therapeutics International Ltd.’s (Nasdaq: CHTP) shares climbed 22% to $4.86 on April 18, after the biotechnology company revealed plans to file a New Drug Application (NDA) for its blood pressure drug candidate Northera in the third quarter. Moreover, the company agreed with the Food and Drug Administration that the application would be submitted based on the results of the first two successfully completed studies on the drug. Approximately 3.6 million shares changed hands, a 460% increase over its 90-day average volume.

    Despite the surge, the stock lost 29% this year, mainly due to mixed results from a third Phase III investigation on Northera and subsequent speculations that the disappointing data could limit the prescription of medicine. In addition, concerns that CHPT would raise additional cash to continue investigations, while diluting the existing shareholders’ ownership, have also taken a toll on the company’s valuation.

    Chelsea Therapeutics is a biopharmaceutical company that develops innovative products for the treatment of a variety of human diseases. Specifically, the company is developing Northera (droxidopa) for the treatment of symptomatic neurogenic orthostatic hypotension (NOH) and falls related to NOH in Parkinson’s disease, as well as other related conditions and diseases including intradialytic hypotension, fibromyalgia, adult attention deficit hyperactivity disorder and chronic fatigue syndrome. CHTP is also researching additional medicines for rheumatoid arthritis, psoriasis, inflammatory bowel disease and cancer.

    The company’s most advanced drug candidate, Northera (droxidopa), is an orally active synthetic precursor of norepinephrine that is currently in Phase III trials for the treatment of symptomatic NOH.  The FDA granted orphan drug status to the drug in 2007 and admitted last December, that the company could file an NDA for Northera based on combined data from two completed Phase III studies in NOH, Study 301 and Study 302, and their associated safety Studies 303, 304 and 305, without the need for any further efficacy studies. If successful, the drug could reach the U.S. market in 2012.

    The last Phase III study, codenamed 306, enrolled Parkinson’s disease patients suffering from NOH. The company failed to demonstrate statistically significant benefits of Northera over placebo; however it showed that patients treated with the drug suffered fewer falls than patients treated with a placebo. While the results raised some concerns about the size of Northera’s target market, since approximately 40% of all NOH patients are linked to Parkinson’s disease, the drug still have strong chances to be approved, even for Parkinson’s disease patients, in 2012.

    The treatment has been approved and marketed in Japan and some surrounding Asian countries since 1989 for the treatment of symptomatic orthostatic hypotension, freezing of gait in Parkinson’s disease patients and intradialytic hypotension. Accordingly, the drug has over 15 years of proven safety and efficacy in its target indications.

    NOH is a disorder of the nervous system, characterized by low blood pressure, light-headedness, dizziness, blurred vision and fainting episodes upon standing. According to the company, it affects over 300,000 patients in the U.S. and E.U.

    In addition to droxidopa, CHTP is also developing a portfolio of metabolically inert oral antifolate molecules engineered to have potent anti-inflammatory and anti-tumor activity to treat a range of immunological disorders, including two clinical stage product candidates: CH-1504 and CH-4051. Preclinical and clinical data suggest superior safety and tolerability, as well as increased potency versus current standard of care.

    Going forward, the company’s valuation could be boosted by the scheduled announcement of data from multiple Phase II trials of droxidopa in new indications, as well as submission of its first NDA for Northera to the FDA.

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