On the heels of winning an eight-year quest for approval of a drug to help preterm infants breathe, an East Coast drug developer outlined a $12 million to $13 million commercialization plan.
Discovery Labs (NASDAQ:DSCO) secured approval from the U.S. Food and Drug Administration for Surfaxin, the first synthetic surfactant to treat respiratory distress syndrome in preterm babies. The company told investors today that the approval reflects a broader industry trend of replacing products derived from animals, such as insulin and thyroid and growth hormone therapies, with synthetic versions. A company director on the conference call said, “These drugs are absolutely critical products and can ultimately turn neonatology on its head.” Discovery Labs is also seeking approval for Surfaxin LS, a lyophilized version.
Alongside Surfaxin, the company said it is commercializing Afectair, a device that delivers aerosolized drugs to patients on mechanical ventilation. Afectair was approved Feb. 2 and is for use in NICUs, pediatric intensive care units and adult intensive care units.
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Develop a U.S. sales and marketing team. One of the first things the Warrington, Pennsylvania company said it would do following Surfaxin’s approval is build a sales and marketing team. To that end, it is “building a specialty respiratory critical care commercial and medical affairs organization specializing in neonatal indication,” according to a document filed with the U.S. Securities and Exchange Commission.
Target hospitals with Neonatal Intensive Care Units. Discovery Labs will focus on NICU departments and pediatric hospitals that it says represent much of the current surfactant market. The company said it plans to use this base when other drugs in its pipeline are approved, including Surfaxin LS and its drug-delivery device Aerosurf, which is for NICUs only. The company is also setting up a platform for healthcare facilities to access the drug mechanically.
Raise more money. In its SEC document, the company outlined several approaches it will be taking to raise money in the run up to commercialization for Surfaxin later this year. In December 2011, it set up an at-the-market (ATM) common stock sale with Lazard to sell up to $15 million in shares over two years.
Consider strategic alliances. It is also eyeing potential strategic alliances in which a company would invest a certain amount if Discovery’s drugs meet certain milestones. The company is also considering a term loan and other debt options. The company said on the call, “We are going to build our company; we are going to strengthen our company. If along that path somebody is looking for a strategic transaction with the company, of course we will consider it.”
