(Corrects paragraph 12 in Sept 23 story to show that patients are put on the double-blind portion of the study after at least 7 days, not 14 days)
* What: Data from late-stage neurology drug
* When: Late September
* Analysts expect the trial to meet main goal
By Anand Basu
BANGALORE, Sept 23 (Reuters) - Chelsea Therapeutics' experimental neurological disorder drug, which is already approved in Japan, is expected to show high efficacy and a clean safety profile in a U.S. late-stage trial.
Data from the first of two late-stage trials for Chelsea's drug, Droxidopa, is expected in late September and the stock has risen more than 3 times over the last six months in anticipation of positive news.
Droxidopa, which aims to treat symptomatic neurogenic orthostatic hypotension (NOH) -- a neurological disorder that causes blood pressure to drop when the afflicted person assumes a standing position -- has a fast track status from U.S. health regulators.
"The drug is already approved in Japan for over 10 years, so the drug works, the question is execution risk in clinical trial," Wedbush Morgan Securities analyst Liana Moussatos said. If approved, Droxidopa could easily replace the current standard-of-care midodrine for the treatment of NOH, based on its better safety profile.
Currently the use of midodrine is limited due to concerns of supine hypertension -- an excessive increase in blood pressure, especially when lying down.
"The side effect profile for Droxidopa is far superior to midodrine, and it is also more effective. For a safety point of view this is about as clean as drug you can get," Roth Capital Partners analyst Andrew Vaino said.
About 70 percent of patients using midodrine encounter hypertension, but in Droxidopa that portion drops to about 1 percent, he said.
Vaino, who has a "buy" rating and $7 price target on Chelsea shares, expects the company to launch the drug in the first quarter of 2011. Wedbush's Moussatos, who expects the U.S. Food and Drug Administration to approve the drug in the fourth quarter of 2010, sees peak Droxidopa sales of about $275 million in the United States.
Some investors have voiced concerns of a potential placebo effect -- a genuine improvement in health driven by psychological expectations of a benefit and not due to the physiological effect of a given treatment -- but Moussatos is unperturbed.
During the initial open label titration phase all patients received the drug. Patients who respond to the drug at any of the doses are kept on the treatment for at least 7 days. Following this, half the responder group was put on the drug daily for two weeks, while the rest got a dummy drug.
"Investors are concerned that 14 days without Droxidopa treatment may not be long enough for the higher dose to wash out and NOH symptoms to return," said Moussatos, who has an "outperform" rating and $13 price target on Chelsea shares.
But the analyst believes that symptoms usually re-appear within 2-3 days after a patient stops taking the drug -- leaving plenty of time for the symptoms to re-emerge and differentiate the placebo patients from the drug patients. (Reporting by Anand Basu in Bangalore; Editing by Anthony Kurian)