Cephalon will not develop the attention deficit/hyperactivity disorder treatment Sparlon (modafinil) following an FDA "non-approvable" letter, the company announced Aug. 9.

The agency's rejection of Sparlon apparently came down to a suspected case of Stevens Johnson Syndrome in a Phase III trial, CEO Frank Baldino said in response to an analyst's question during a same-day conference call.

"The only issue ever raised with this drug was this particular case and we really thought we put it to bed," the exec said. During an Aug. 3 earnings call, Baldino had said that he was confident the drug would gain approval since data presented to FDA, according to Cephalon, demonstrated that the case was not SJS (¹ Also see "September Launch Eyed For Cephalon/J&J’s Sparlon" - Pink Sheet, 7 August, 2006.).

Baldino said the decision to drop Sparlon was based on the company's belief that they had run out of options and an appeal would be pointless.

"The recommendations by the agency in going forward left no guarantees and a lot of very large studies, and in our opinion, it's impossible to prove the negatives," he said. "Since there never was a case of SJS here, we don't know how to design a study that shows that a case never occurred."

"I think the message we've received today is pretty clear: That there's really nothing we can do to change the position of the FDA on this matter, so we've decided not to" continue development, Baldino added.

Although Cephalon was planning to sell the drug with marketing partner Johnson & Johnson, the company will not have any financial responsibilities to J&J as a result of the letter and the deal will simply expire at the end of the year.

A second piece of bad news for Cephalon also came on Aug. 9 in the form of an FDA user fee date extension to Dec. 31 for the company's excessive sleepiness drug candidate Nuvigil (armodafinil), a follow-on to the company's Provigil , which has the same active ingredient (modafinil) as Sparlon.

Cephalon Exec. VP-Worldwide Medical & Regulatory Operations Paul Blake said the company had submitted further safety analyses from Provigil's marketing experience based on a request from FDA.

Baldino said that he expects Nuvigil to gain approval. In response to an analyst's question, he said that although the agency may choose to strengthen Provigil's label, he is "not concerned" and does not believe the Sparlon decision will have any impact on Provigil.

Baldino maintained that 2007 will still be a "growth year" for Cephalon, and will be buoyed by Provigil growth, the potential approval of breakthrough pain medication Fentora (fentanyl buccal tablet) in September, and strong sales of the alcohol dependence treatment Vivitrol (naltrexone for extended-release injectable suspension).

- Jonathan Block

Spar-Gone: Cephalon Drops Sparlon Following "Non-Approvable" Letter

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