Circassia prepares for potential US launch of nitric oxide product

UK biotech Circassia has said that its partner AIT Therapeutics has held a meeting with the FDA that paves the way for premarket approval of its nitric oxide product for newborn babies with respiratory failure, AirNOvent.

AirNOvent is a portable system delivering precise quantities of nitric oxide, using smart filters to remove unwanted NO2.

Nitric oxide is approved in the US as part of a regimen to treat life threatening hypoxic respiratory failure associated with persistent pulmonary hypertension of the newborn.

There is only one inhaled product available - Mallincrodt’s InoMax, which is estimated by Circassia to generate around $400m annually, based on full year 2017 figures.

Following a successful pre-submission meeting, China-based AIT expects to apply for premarket approval in Q2 this year, and will seek a label extension for the product’s use in a related indication.

Circassia then hopes to launch the product in the US, after paying AIT $7.35 million up front.

Further payments of up to $25.2 million are due if certain targets are met under the terms of a deal to acquire US and Chinese rights to the product late last month.

The deal covered all potential indications in the hospital setting for the drug at up to 80 parts per million, which included the neonatal indication.

Circassia will raise the money to fund the milestone payments by issuing shares.

The UK biotech will also pay tiered royalties on gross profits from future sales of the product.

Circassia is trying to bounce back after abandoning development of four allergy drugs, that it had hoped would produce revenues of more than $2 billion.

But the drugs failed to produce results in two phase 3 trials in cat and house dust mite allergy and Circassia abandoned development two years ago.

Since then it has struck a commercial collaboration with AstraZeneca to promote the latter’s drug for chronic obstructive pulmonary disease, and has rights to the follow-on product Duaklir.

Later this year Circassia expects to take full control of Tudorza in the US under the terms of the agreement.